EVERSOURCE ENERGY AND SUBSIDIARIES

THE CONNECTICUT LIGHT AND POWER COMPANY

NSTAR ELECTRIC COMPANY AND SUBSIDIARY

PUBLIC SERVICE COMPANY OF NEW HAMPSHIRE AND ~~SUBSIDIARY~~SUBSIDIARIES

~~WESTERN MASSACHUSETTS ELECTRIC COMPANY~~

TABLE OF CONTENTS



				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 Common Shareholders' Equity	3
			Condensed Consolidated Statements of Cash Flows	35

			The Connecticut Light and Power Company (Unaudited)
			Condensed Balance Sheets	46
			Condensed Statements of Income	57
			Condensed Statements of Comprehensive Income	57
			Condensed Statements of Common Stockholder's Equity	8
			Condensed Statements of Cash Flows	69

			NSTAR Electric Company and Subsidiary (Unaudited)
			Condensed Consolidated Balance Sheets	710
			Condensed Consolidated Statements of Income	811
			Condensed Consolidated Statements of Comprehensive Income	811
			Condensed Consolidated Statements of Common Stockholder's Equity	12
			Condensed Consolidated Statements of Cash Flows	913

			Public Service Company of New Hampshire and ~~Subsidiary~~Subsidiaries (Unaudited)
			Condensed Consolidated Balance Sheets	1014
			Condensed Consolidated Statements of Income	1115
			Condensed Consolidated Statements of Comprehensive Income	1115
			Condensed Consolidated Statements of Common Stockholder's Equity	16
			Condensed Consolidated Statements of Cash Flows	1217

			~~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)	1618

ITEM 2.			Management's Discussion and Analysis of Financial Condition and Results of Operations
			Eversource Energy and Subsidiaries	3542
			The Connecticut Light and Power Company	50
	, NSTAR Electric Company and Subsidiary, and	53
	Public Service Company of New Hampshire and ~~Subsidiary~~Subsidiaries	5561
			~~Western Massachusetts Electric Company~~	57

ITEM 3.			Quantitative and Qualitative Disclosures About Market Risk	5969

ITEM 4.			Controls and Procedures	5969

PART II – OTHER INFORMATION

ITEM 1.			Legal Proceedings	6070

ITEM 1A.			Risk Factors	~~Risk Factors~~70	60

ITEM 2.			Unregistered Sales of Equity Securities and Use of Proceeds	6071

ITEM 6.			Exhibits	6172

SIGNATURES				6374

iii

EVERSOURCE ENERGY AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)


(Thousands of Dollars)	As of September 30, 2021		As of December 31, 2020

ASSETS
Current Assets:
Cash	$	88,204	$	106,599
Receivables, Net (net of allowance for uncollectible accounts of $441,723 and $358,851 as of September 30, 2021 and December 31, 2020, respectively)	1,288,758		1,195,925
Unbilled Revenues	176,325		233,025
Fuel, Materials, Supplies and REC Inventory	217,286		265,599
Regulatory Assets	1,016,304		1,076,556
Prepayments	177,869		105,620
Other Current Assets	108,807		146,819
Total Current Assets	3,073,553		3,130,143
Property, Plant and Equipment, Net	32,467,069		30,882,523
Deferred Debits and Other Assets:
Regulatory Assets	5,458,928		5,493,330
Goodwill	4,453,618		4,445,988
Investments in Unconsolidated Affiliates	1,356,313		1,107,143
Marketable Securities	466,628		456,617
Other Long-Term Assets	737,946		583,854
Total Deferred Debits and Other Assets	12,473,433		12,086,932
Total Assets	$	48,014,055	$	46,099,598

LIABILITIES AND CAPITALIZATION
Current Liabilities:
Notes Payable	$	711,000	$	1,249,325
Long-Term Debt – Current Portion	798,880		1,053,186
Rate Reduction Bonds – Current Portion	43,210		43,210
Accounts Payable	1,289,225		1,370,647

Regulatory Liabilities	612,931		389,430
Other Current Liabilities	802,831		809,214
Total Current Liabilities	4,258,077		4,915,012
Deferred Credits and Other Liabilities:
Accumulated Deferred Income Taxes	4,341,105		4,095,339
Regulatory Liabilities	3,907,582		3,850,781
Derivative Liabilities	256,569		294,535
Asset Retirement Obligations	505,005		499,713
Accrued Pension, SERP and PBOP	1,330,037		1,653,788
Other Long-Term Liabilities	974,497		948,506
Total Deferred Credits and Other Liabilities	11,314,795		11,342,662
Long-Term Debt	17,420,300		15,125,876
Rate Reduction Bonds	453,702		496,912
Noncontrolling Interest – Preferred Stock of Subsidiaries	155,570		155,570
Common Shareholders' Equity:
Common Shares	1,789,092		1,789,092
Capital Surplus, Paid In	8,050,872		8,015,663
Retained Earnings	4,906,151		4,613,201
Accumulated Other Comprehensive Loss	(71,865)		(76,411)
Treasury Stock	(262,639)		(277,979)
Common Shareholders' Equity	14,411,611		14,063,566
Commitments and Contingencies (Note 9)	0		0
Total Liabilities and Capitalization	$	48,014,055	$	46,099,598

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

ASSETS

Current Assets:

Cash and Cash Equivalents $ 125,761

$ 30,251
Receivables, Net 919,959

847,301
Unbilled Revenues 146,634

168,490
Fuel, Materials, Supplies and Inventory 305,035

328,721
Regulatory Assets 746,142

887,625
Prepayments and Other Current Assets 159,939

215,284
Total Current Assets 2,403,470

2,477,672

Property, Plant and Equipment, Net 22,537,304

21,350,510

Deferred Debits and Other Assets:

Regulatory Assets 3,505,901

3,638,688
Goodwill 3,519,401

3,519,401
Marketable Securities 570,255

544,642
Other Long-Term Assets 627,289

522,260
Total Deferred Debits and Other Assets 8,222,846

8,224,991

Total Assets $ 33,163,620

$ 32,053,173

LIABILITIES AND CAPITALIZATION

Current Liabilities:

Notes Payable $ 18,238

$ 1,148,500
Long-Term Debt – Current Portion 957,697

773,883
Accounts Payable 794,195

884,521
Obligations to Third Party Suppliers 149,789

122,806
Regulatory Liabilities 170,215

146,787
Other Current Liabilities 530,297

562,108
Total Current Liabilities 2,620,431

3,638,605

Deferred Credits and Other Liabilities:

Accumulated Deferred Income Taxes 6,001,589

5,607,207
Regulatory Liabilities 700,207

702,255
Derivative Liabilities 391,910

413,676
Accrued Pension and SERP 946,629

1,141,514
Other Long-Term Liabilities 881,056

853,260
Total Deferred Credits and Other Liabilities 8,921,391

8,717,912

Capitalization:

Long-Term Debt 10,468,193

8,829,354

Noncontrolling Interest – Preferred Stock of Subsidiaries 155,568

155,568

Equity:

Common Shareholders' Equity:

Common Shares 1,669,392

1,669,392
Capital Surplus, Paid In 6,235,846

6,250,224
Retained Earnings 3,474,185

3,175,171
Accumulated Other Comprehensive Loss (63,615 )
(65,282 )
Treasury Stock (317,771 )
(317,771 )
Common Shareholders' Equity 10,998,037

10,711,734
Total Capitalization 21,621,798

19,696,656

Total Liabilities and Capitalization $ 33,163,620

$ 32,053,173

~~The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.~~

~~EVERSOURCE ENERGY AND SUBSIDIARIES~~

~~CONDENSED CONSOLIDATED STATEMENTS OF INCOME~~

~~(Unaudited)~~

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

Operating Revenues $ 1,988,512
$ 2,039,706
$ 5,856,458
$ 5,862,525

Operating Expenses:
Purchased Power, Fuel and Transmission 651,776
665,810
1,955,129
2,001,929
Operations and Maintenance 300,421
324,734
933,400
965,584
Depreciation 194,466
181,288
571,152
531,781
Amortization of Regulatory Assets, Net 41,848
43,942
58,058
56,223
Energy Efficiency Programs 129,205
149,121
391,761
405,962
Taxes Other Than Income Taxes 168,193
164,942
479,648
479,219
Total Operating Expenses 1,485,909
1,529,837
4,389,148
4,440,698
Operating Income 502,603
509,869
1,467,310
1,421,827
Interest Expense 108,719
99,865
319,477
298,568
Other Income, Net 21,184
13,641
56,304
23,689
Income Before Income Tax Expense 415,068
423,645
1,204,137
1,146,948
Income Tax Expense 152,818
156,446
447,921
428,186
Net Income 262,250
267,199
756,216
718,762
Net Income Attributable to Noncontrolling Interests 1,880
1,880
5,639
5,639
Net Income Attributable to Common Shareholders $ 260,370
$ 265,319
$ 750,577
$ 713,123

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

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

Weighted Average Common Shares Outstanding:
Basic 317,393,029
317,787,836
317,415,848
317,696,823
Diluted 317,949,396
318,577,079
318,007,042
318,511,609

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

~~CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME~~

~~(Unaudited)~~

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

Net Income $ 262,250
$ 267,199
$ 756,216
$ 718,762
Other Comprehensive (Loss)/Income, Net of Tax:
Qualified Cash Flow Hedging Instruments 519
534
1,567
1,602
Changes in Unrealized (Losses)/Gains on
  Marketable Securities
(1,872 ) 946
733
2,271
Changes in Funded Status of Pension, SERP and
  PBOP Benefit Plans
673
(1,733 ) (633 ) (2,646 )
Other Comprehensive (Loss)/Income, Net of Tax (680 ) (253 ) 1,667
1,227
Comprehensive Income Attributable to
  Noncontrolling Interests
(1,880 ) (1,880 ) (5,639 ) (5,639 )
Comprehensive Income Attributable to Common
  Shareholders
$ 259,690
$ 265,066
$ 752,244
$ 714,350

~~The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.~~

EVERSOURCE ENERGY AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF ~~CASH FLOWS~~INCOME

(Unaudited)


	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
(Thousands of Dollars, Except Share Information)	2021		2020		2021		2020

Operating Revenues	$	2,432,794	$	2,343,642	$	7,381,172	$	6,670,497

Operating Expenses:
Purchased Power, Fuel and Transmission	880,639		806,254		2,529,217		2,312,957
Operations and Maintenance	389,065		332,031		1,265,754		1,006,148
Depreciation	276,846		244,453		822,197		721,179
Amortization	45,236		57,515		158,860		130,687
Energy Efficiency Programs	143,796		145,047		460,814		408,794
Taxes Other Than Income Taxes	213,881		197,112		623,827		556,726
Total Operating Expenses	1,949,463		1,782,412		5,860,669		5,136,491
Operating Income	483,331		561,230		1,520,503		1,534,006
Interest Expense	147,962		134,066		431,162		403,067
Other Income, Net	43,768		29,218		124,588		83,565
Income Before Income Tax Expense	379,137		456,382		1,213,929		1,214,504
Income Tax Expense	94,091		108,242		294,461		275,621
Net Income	285,046		348,140		919,468		938,883
Net Income Attributable to Noncontrolling Interests	1,880		1,880		5,639		5,639
Net Income Attributable to Common Shareholders	$	283,166	$	346,260	$	913,829	$	933,244

Basic Earnings Per Common Share	$	0.82	$	1.01	$	2.66	$	2.77

Diluted Earnings Per Common Share	$	0.82	$	1.01	$	2.65	$	2.76

Weighted Average Common Shares Outstanding:
Basic	344,023,846		343,076,614		343,848,905		337,375,172
Diluted	344,669,782		343,773,602		344,480,056		338,424,100

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

Operating Activities:

Net Income $ 756,216

$ 718,762
Adjustments to Reconcile Net Income to Net Cash Flows Provided by Operating Activities:

Depreciation 571,152

531,781
Deferred Income Taxes 374,863

301,413
Pension, SERP and PBOP Expense, Net 16,891

31,627
Pension and PBOP Contributions (197,900 )
(121,854 )
Regulatory Overrecoveries, Net 185,952

152,808
Amortization of Regulatory Assets, Net 58,058

56,223
Other (148,741 )
(27,671 )
Changes in Current Assets and Liabilities:

Receivables and Unbilled Revenues, Net (107,473 )
(191,454 )
Fuel, Materials, Supplies and Inventory 23,686

25,425
Taxes Receivable/Accrued, Net 88,856

347,898
Accounts Payable (96,551 )
(121,513 )
Other Current Assets and Liabilities, Net (32,874 )
(53,077 )
Net Cash Flows Provided by Operating Activities 1,492,135

1,650,368

Investing Activities:

Investments in Property, Plant and Equipment (1,642,280 )
(1,359,171 )
Proceeds from Sales of Marketable Securities 520,664

444,209
Purchases of Marketable Securities (506,302 )
(437,197 )
Other Investing Activities (10,177 )
(9,463 )
Net Cash Flows Used in Investing Activities (1,638,095 )
(1,361,622 )

Financing Activities:

Cash Dividends on Common Shares (451,562 )
(423,471 )
Cash Dividends on Preferred Stock (5,639 )
(5,639 )
Decrease in Notes Payable (231,500 )
(426,453 )
Issuance of Long-Term Debt 1,250,000

800,000
Retirements of Long-Term Debt (320,000 )
(200,000 )
Other Financing Activities 171

(17,074 )
Net Cash Flows Provided by/(Used in) Financing Activities 241,470

(272,637 )
Net Increase in Cash and Cash Equivalents 95,510

16,109
Cash and Cash Equivalents - Beginning of Period 30,251

23,947
Cash and Cash Equivalents - End of Period $ 125,761

$ 40,056

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

~~THE CONNECTICUT LIGHT AND POWER COMPANY~~

CONDENSED ~~BALANCE SHEETS~~

~~(Unaudited)~~

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

ASSETS
Current Assets:
Cash $ 9,364
$ 6,579
Receivables, Net 404,065
359,132
Accounts Receivable from Affiliated Companies 29,287
16,851
Unbilled Revenues 48,625
50,373
Materials, Supplies and Inventory 44,516
52,050
Regulatory Assets 274,982
335,526
Prepaid Property Taxes 55,375
19,678
Prepayments and Other Current Assets 13,832
32,992
Total Current Assets 880,046
873,181

Property, Plant and Equipment, Net 8,107,957
7,632,392

Deferred Debits and Other Assets:
Regulatory Assets 1,312,191
1,391,564
Other Long-Term Assets 145,246
137,907
Total Deferred Debits and Other Assets 1,457,437
1,529,471

Total Assets $ 10,445,440
$ 10,035,044

LIABILITIES AND CAPITALIZATION
Current Liabilities:
Notes Payable to Eversource Parent $ —
$ 80,100
Long-Term Debt – Current Portion 300,000
250,000
Accounts Payable 292,234
289,532
Accounts Payable to Affiliated Companies 80,899
88,075
Obligations to Third Party Suppliers 52,865
55,520
Accrued Taxes 64,332
16,090
Regulatory Liabilities 69,296
47,055
Derivative Liabilities 59,895
77,765
Other Current Liabilities 99,467
104,309
Total Current Liabilities 1,018,988
1,008,446

Deferred Credits and Other Liabilities:
Accumulated Deferred Income Taxes 2,089,480
1,987,661
Regulatory Liabilities 98,777
100,138
Derivative Liabilities 391,758
412,750
Accrued Pension, SERP and PBOP 297,492
300,208
Other Long-Term Liabilities 134,870
123,244
Total Deferred Credits and Other Liabilities 3,012,377
2,924,001

Capitalization:
Long-Term Debt 2,758,851
2,516,010

Preferred Stock Not Subject to Mandatory Redemption 116,200
116,200

Common Stockholder's Equity:
Common Stock 60,352
60,352
Capital Surplus, Paid In 2,110,752
2,110,714
Retained Earnings 1,367,650
1,299,374
Accumulated Other Comprehensive Income/(Loss) 270
(53 )
Common Stockholder's Equity 3,539,024
3,470,387
Total Capitalization 6,414,075
6,102,597

Total Liabilities and Capitalization $ 10,445,440
$ 10,035,044

~~The accompanying notes are an integral part of these unaudited condensed financial statements.~~

~~THE CONNECTICUT LIGHT AND POWER COMPANY~~

~~CONDENSED STATEMENTS OF INCOME~~

~~(Unaudited)~~

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

Operating Revenues $ 774,762
$ 760,037
$ 2,173,629
$ 2,175,141

Operating Expenses:
Purchased Power and Transmission 259,005
253,509
711,154
760,613
Operations and Maintenance 123,107
123,034
359,834
356,409
Depreciation 63,727
57,675
184,275
172,175
Amortization of Regulatory Assets, Net 34,574
23,418
58,799
30,308
Energy Efficiency Programs 37,739
44,381
106,483
117,969
Taxes Other Than Income Taxes 79,067
81,948
223,482
227,981
Total Operating Expenses 597,219
583,965
1,644,027
1,665,455
Operating Income 177,543
176,072
529,602
509,686
Interest Expense 36,313
36,083
106,577
108,561
Other Income, Net 7,509
3,669
14,070
10,881
Income Before Income Tax Expense 148,739
143,658
437,095
412,006
Income Tax Expense 52,595
57,026
159,450
155,453
Net Income $ 96,144
$ 86,632
$ 277,645
$ 256,553

~~The accompanying notes are an integral part of these unaudited condensed financial statements.~~

~~CONDENSED~~CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Unaudited)


	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
(Thousands of Dollars)	2021		2020		2021		2020

Net Income	$	285,046	$	348,140	$	919,468	$	938,883
Other Comprehensive Income, Net of Tax:
Qualified Cash Flow Hedging Instruments	115		602		967		1,218
Changes in Unrealized (Losses)/Gains on Marketable Securities	(106)		(134)		(569)		295
Changes in Funded Status of Pension, SERP and PBOP Benefit Plans	2,468		1,693		4,148		3,149
Other Comprehensive Income, Net of Tax	2,477		2,161		4,546		4,662
Comprehensive Income Attributable to Noncontrolling Interests	(1,880)		(1,880)		(5,639)		(5,639)
Comprehensive Income Attributable to Common Shareholders	$	285,643	$	348,421	$	918,375	$	937,906

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

Net Income $ 96,144
$ 86,632
$ 277,645
$ 256,553
Other Comprehensive Income, Net of Tax:
Qualified Cash Flow Hedging Instruments 96
111
298
333
Changes in Unrealized (Losses)/Gains on
Marketable Securities
(64 ) 33
25
78
Other Comprehensive Income, Net of Tax 32
144
323
411
Comprehensive Income $ 96,176
$ 86,776
$ 277,968
$ 256,964

~~The accompanying notes are an integral part of these unaudited condensed financial statements.~~

~~THE CONNECTICUT LIGHT AND POWER COMPANY~~

~~CONDENSED STATEMENTS OF CASH FLOWS~~

~~(Unaudited)~~

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

Operating Activities:
Net Income $ 277,645
$ 256,553
Adjustments to Reconcile Net Income to Net Cash Flows Provided by Operating Activities:
Depreciation 184,275
172,175
Deferred Income Taxes 90,132
109,637
Pension, SERP, and PBOP Expense, Net of PBOP Contributions 4,546
4,825
Regulatory Overrecoveries, Net 71,413
33,492
Amortization of Regulatory Assets, Net 58,799
30,308
Other (22,113 ) (14,873 )
Changes in Current Assets and Liabilities:
Receivables and Unbilled Revenues, Net (70,936 ) (100,074 )
Taxes Receivable/Accrued, Net 69,335
197,422
Accounts Payable (1,649 ) (30,168 )
Other Current Assets and Liabilities, Net (38,111 ) (44,908 )
Net Cash Flows Provided by Operating Activities 623,336
614,389

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

Financing Activities:
Cash Dividends on Common Stock (205,200 ) (149,700 )
Cash Dividends on Preferred Stock (4,169 ) (4,169 )
Capital Contributions from Eversource Parent —
145,700
Issuance of Long-Term Debt 525,000
—
Retirement of Long-Term Debt (250,000 ) —
Decrease in Notes Payable to Eversource Parent (80,100 ) (168,900 )
Premium on Issuance of Long-Term Debt 21,937
—
Other Financing Activities (6,322 ) (609 )
Net Cash Flows Provided by/(Used in) Financing Activities 1,146
(177,678 )
Net Increase in Cash 2,785
7,550
Cash - Beginning of Period 6,579
1,057
Cash - End of Period $ 9,364
$ 8,607

~~The accompanying notes are an integral part of these unaudited condensed financial statements.~~

~~NSTAR ELECTRIC COMPANY AND SUBSIDIARY~~

~~CONDENSED CONSOLIDATED BALANCE SHEETS~~

~~(Unaudited)~~

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

ASSETS

Current Assets:
Cash and Cash Equivalents $ 89,915
$ 3,494
Receivables, Net 322,193
257,557
Accounts Receivable from Affiliated Companies 13,632
8,581
Unbilled Revenues 39,160
31,632
Taxes Receivable —
39,738
Materials, Supplies and Inventory 53,203
62,288
Regulatory Assets 230,620
289,400
Prepayments and Other Current Assets 16,550
14,906
Total Current Assets 765,273
707,596

Property, Plant and Equipment, Net 6,268,689
6,051,835

Deferred Debits and Other Assets:
Regulatory Assets 1,049,324
1,057,746
Prepaid PBOP 115,367
95,073
Other Long-Term Assets 79,653
60,572
Total Deferred Debits and Other Assets 1,244,344
1,213,391

Total Assets $ 8,278,306
$ 7,972,822

LIABILITIES AND CAPITALIZATION
Current Liabilities:
Notes Payable $ —
$ 126,500
Long-Term Debt – Current Portion 43,814
400,000
Accounts Payable 198,251
232,599
Accounts Payable to Affiliated Companies 81,953
91,532
Obligations to Third Party Suppliers 86,346
55,863
Renewable Portfolio Standards Compliance Obligations 69,527
75,571
Accrued Taxes 32,021
3,922
Regulatory Liabilities 65,520
63,653
Other Current Liabilities 58,628
67,200
Total Current Liabilities 636,060
1,116,840

Deferred Credits and Other Liabilities:
Accumulated Deferred Income Taxes 1,910,328
1,836,292
Regulatory Liabilities 392,851
391,823
Accrued Pension and SERP 39,830
111,827
Other Long-Term Liabilities 135,613
123,194
Total Deferred Credits and Other Liabilities 2,478,622
2,463,136

Capitalization:
Long-Term Debt 2,382,392
1,678,116

Preferred Stock Not Subject to Mandatory Redemption 43,000
43,000

Common Stockholder's Equity:
Common Stock —
—
Capital Surplus, Paid In 1,047,678
1,045,378
Retained Earnings 1,690,198
1,625,984
Accumulated Other Comprehensive Income 356
368
Common Stockholder's Equity 2,738,232
2,671,730
Total Capitalization 5,163,624
4,392,846

Total Liabilities and Capitalization $ 8,278,306

$ 7,972,822

~~The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.~~

~~NSTAR ELECTRIC COMPANY AND SUBSIDIARY~~

~~CONDENSED CONSOLIDATED STATEMENTS OF INCOME~~

~~(Unaudited)~~

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

Operating Revenues $ 725,701
$ 780,462
$ 1,913,548
$ 1,985,979

Operating Expenses:

Purchased Power and Transmission 259,400
291,382
689,784
764,907
Operations and Maintenance 92,571
96,282
266,203
279,932
Depreciation 56,200
54,695
167,598
159,151
Amortization of Regulatory Assets, Net 9,845
9,621
17,806
18,275
Energy Efficiency Programs 71,615
84,717
198,803
212,882
Taxes Other Than Income Taxes 37,052
35,050
99,090
101,800
Total Operating Expenses 526,683
571,747
1,439,284
1,536,947
Operating Income 199,018
208,715
474,264
449,032
Interest Expense 24,488
21,101
69,962
62,206
Other Income, Net 3,426
5,022
8,703
7,524
Income Before Income Tax Expense 177,956
192,636
413,005
394,350
Income Tax Expense 69,796
75,440
161,320
154,493
Net Income $ 108,160
$ 117,196
$ 251,685
$ 239,857

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

EVERSOURCE ENERGY AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF ~~COMPREHENSIVE INCOME~~COMMON SHAREHOLDERS' EQUITY

(Unaudited)


	For the Nine Months Ended September 30, 2021
	Common Shares			Capital Surplus, Paid In		Retained Earnings		Accumulated Other Comprehensive Loss		Treasury Stock		Total Common Shareholders' Equity
(Thousands of Dollars, Except Share Information)	Shares	Amount
Balance as of January 1, 2021	342,954,023	$	1,789,092	$	8,015,663	$	4,613,201	$	(76,411)	$	(277,979)	$	14,063,566
Net Income						368,023						368,023
Dividends on Common Shares - $0.6025 Per Share						(206,913)						(206,913)
Dividends on Preferred Stock						(1,880)						(1,880)
Long-Term Incentive Plan Activity				(15,727)								(15,727)
Issuance of Treasury Shares	480,275			16,182						8,981		25,163

Other Comprehensive Income								1,188				1,188
Balance as of March 31, 2021	343,434,298	1,789,092		8,016,118		4,772,431		(75,223)		(268,998)		14,233,420
Net Income						266,400						266,400
Dividends on Common Shares - $0.6025 Per Share						(206,893)						(206,893)
Dividends on Preferred Stock						(1,880)						(1,880)
Long-Term Incentive Plan Activity				6,162								6,162
Issuance of Treasury Shares	166,805			10,679						3,120		13,799

Other Comprehensive Income								881				881
Balance as of June 30, 2021	343,601,103	1,789,092		8,032,959		4,830,058		(74,342)		(265,878)		14,311,889
Net Income						285,046						285,046
Dividends on Common Shares - $0.6025 Per Share						(207,073)						(207,073)
Dividends on Preferred Stock						(1,880)						(1,880)
Long-Term Incentive Plan Activity				6,478								6,478
Issuance of Treasury Shares	173,221			11,435						3,239		14,674
Other Comprehensive Income								2,477				2,477
Balance as of September 30, 2021	343,774,324	$	1,789,092	$	8,050,872	$	4,906,151	$	(71,865)	$	(262,639)	$	14,411,611

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

Net Income $ 108,160
$ 117,196
$ 251,685
$ 239,857
Other Comprehensive Loss, Net of Tax:
Changes in Funded Status of SERP Benefit Plan (4 ) (10 ) (12 ) (31 )
Other Comprehensive Loss, Net of Tax (4 ) (10 ) (12 ) (31 )
Comprehensive Income $ 108,156
$ 117,186
$ 251,673
$ 239,826

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

~~NSTAR ELECTRIC COMPANY~~EVERSOURCE ENERGY AND ~~SUBSIDIARY~~SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF ~~CASH FLOWS~~COMMON SHAREHOLDERS' EQUITY

(Unaudited)


	For the Nine Months Ended September 30, 2020
	Common Shares			Capital Surplus, Paid In		Retained Earnings		Accumulated Other Comprehensive Loss		Treasury Stock		Total Common Shareholders' Equity
(Thousands of Dollars, Except Share Information)	Shares	Amount
Balance as of January 1, 2020	329,880,645	$	1,729,292	$	7,087,768	$	4,177,048	$	(65,059)	$	(299,055)	$	12,629,994
Net Income						336,633						336,633
Dividends on Common Shares - $0.5675 Per Share						(187,462)						(187,462)
Dividends on Preferred Stock						(1,880)						(1,880)
Issuance of Common Shares - $5 par value	5,960,000	29,800		402,300								432,100
Long-Term Incentive Plan Activity				(15,295)								(15,295)
Issuance of Treasury Shares	570,542			17,230						10,516		27,746
Capital Stock Expense				(12,314)								(12,314)
Adoption of Accounting Standards Update 2016-13						(1,514)						(1,514)
Other Comprehensive Income								1,948				1,948
Balance as of March 31, 2020	336,411,187	1,759,092		7,479,689		4,322,825		(63,111)		(288,539)		13,209,956
Net Income						254,112						254,112
Dividends on Common Shares - $0.5675 Per Share						(190,964)						(190,964)
Dividends on Preferred Stock						(1,880)						(1,880)
Issuance of Common Shares - $5 par value	6,000,000	30,000		487,560								517,560
Long-Term Incentive Plan Activity				7,694								7,694
Issuance of Treasury Shares	216,675			12,524						4,024		16,548
Capital Stock Expense				(8,321)								(8,321)
Other Comprehensive Income								553				553
Balance as of June 30, 2020	342,627,862	1,789,092		7,979,146		4,384,093		(62,558)		(284,515)		13,805,258
Net Income						348,140						348,140
Dividends on Common Shares - $0.5675 Per Share						(194,493)						(194,493)
Dividends on Preferred Stock						(1,880)						(1,880)
Long-Term Incentive Plan Activity				6,921								6,921
Issuance of Treasury Shares	169,611			10,909						3,001		13,910
Other Comprehensive Income								2,161				2,161
Balance as of September 30, 2020	342,797,473	$	1,789,092	$	7,996,976	$	4,535,860	$	(60,397)	$	(281,514)	$	13,980,017

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

Operating Activities:

Net Income $ 251,685
$ 239,857
Adjustments to Reconcile Net Income to Net Cash Flows Provided by Operating Activities:

Depreciation 167,598
159,151
Deferred Income Taxes 71,327
40,960
Pension, SERP and PBOP (Benefits)/Expense, Net (7,305 ) 1,370
Pension and PBOP Contributions (83,040 ) (26,734 )
Regulatory Overrecoveries, Net 61,356
131,774
Amortization of Regulatory Assets, Net 17,806
18,275
Other (23,120 ) (20,088 )
Changes in Current Assets and Liabilities:

Receivables and Unbilled Revenues, Net (95,398 ) (103,444 )
Materials, Supplies and Inventory 9,086
30,659
Taxes Receivable/Accrued, Net 67,501
141,379
Accounts Payable (38,486 ) (22,913 )
Other Current Assets and Liabilities, Net 13,961
(25,942 )
Net Cash Flows Provided by Operating Activities 412,971
564,304

Investing Activities:

Investments in Property, Plant and Equipment (358,041 ) (327,731 )
Other Investing Activities (3,617 ) —
Net Cash Flows Used in Investing Activities (361,658 ) (327,731 )

Financing Activities:

Cash Dividends on Common Stock (186,000 ) (278,300 )
Cash Dividends on Preferred Stock (1,470 ) (1,470 )
Capital Contributions from Eversource Parent 2,300
25,000
Decrease in Notes Payable (126,500 ) (26,500 )
Issuance of Long-Term Debt 350,000
250,000
Retirements of Long-Term Debt —
(200,000 )
Other Financing Activities (3,222 ) (2,495 )
Net Cash Flows Provided by/(Used in) Financing Activities 35,108
(233,765 )
Increase in Cash and Cash Equivalents 86,421
2,808
Cash and Cash Equivalents - Beginning of Period 3,494
3,346
Cash and Cash Equivalents - End of Period $ 89,915
$ 6,154

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

~~PUBLIC SERVICE COMPANY OF NEW HAMPSHIRE~~EVERSOURCE ENERGY AND ~~SUBSIDIARY~~SUBSIDIARIES

CONDENSED CONSOLIDATED ~~BALANCE SHEETS~~STATEMENTS OF CASH FLOWS

(Unaudited)

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

ASSETS
Current Assets:
Cash $ 597
$ 4,646
Receivables, Net 93,299
84,450
Accounts Receivable from Affiliated Companies 24,331
4,185
Unbilled Revenues 37,133
41,004
Fuel, Materials, Supplies and Inventory 158,091
162,354
Regulatory Assets 112,465
117,240
Prepayments and Other Current Assets 3,797
28,908
Total Current Assets 429,713
442,787

Property, Plant and Equipment, Net 3,167,905
3,039,313

Deferred Debits and Other Assets:
Regulatory Assets 244,561
245,525
Other Long-Term Assets 51,740
37,720
Total Deferred Debits and Other Assets 296,301
283,245

Total Assets $ 3,893,919
$ 3,765,345

LIABILITIES AND CAPITALIZATION
Current Liabilities:
Notes Payable to Eversource Parent $ 202,300
$ 160,900
Long-Term Debt – Current Portion 110,000
70,000
Accounts Payable 92,201
85,716
Accounts Payable to Affiliated Companies 42,788
29,154
Regulatory Liabilities 7,923
12,659
Other Current Liabilities 61,210
43,253
Total Current Liabilities 516,422
401,682

Deferred Credits and Other Liabilities:
Accumulated Deferred Income Taxes 827,412
785,385
Regulatory Liabilities 40,822
44,779
Accrued Pension, SERP and PBOP 98,553
94,652
Other Long-Term Liabilities 54,131
49,442
Total Deferred Credits and Other Liabilities 1,020,918
974,258

Capitalization:
Long-Term Debt 892,581
1,002,048

Common Stockholder's Equity:
Common Stock —
—
Capital Surplus, Paid In 843,134
843,134
Retained Earnings 625,012
549,286
Accumulated Other Comprehensive Loss (4,148 ) (5,063 )
Common Stockholder's Equity 1,463,998
1,387,357
Total Capitalization 2,356,579
2,389,405

Total Liabilities and Capitalization $ 3,893,919
$ 3,765,345


	For the Nine Months Ended September 30,
(Thousands of Dollars)	2021		2020

Operating Activities:
Net Income	$	919,468	$	938,883
Adjustments to Reconcile Net Income to Net Cash Flows Provided by Operating Activities:
Depreciation	822,197		721,179
Deferred Income Taxes	191,346		156,795
Uncollectible Expense	39,690		31,101
Pension, SERP and PBOP (Income)/Expense, Net	(10,882)		9,153
Pension and PBOP Contributions	(140,000)		(107,985)
Regulatory Over/(Under) Recoveries, Net	87,455		(29,287)
Charges at CL&P related to PURA Settlement Agreement and Storm Performance Penalty	103,583		—
Amortization	158,860		130,687


Other	(229,878)		(69,216)
Changes in Current Assets and Liabilities:
Receivables and Unbilled Revenues, Net	(158,205)		(193,895)
Fuel, Materials, Supplies and REC Inventory	48,312		21,102
Taxes Receivable/Accrued, Net	44,003		89,759
Accounts Payable	(258,509)		(121,034)
Other Current Assets and Liabilities, Net	(97,167)		(81,033)
Net Cash Flows Provided by Operating Activities	1,520,273		1,496,209

Investing Activities:
Investments in Property, Plant and Equipment	(2,211,136)		(2,101,564)
Proceeds from Sales of Marketable Securities	334,619		386,712
Purchases of Marketable Securities	(313,961)		(391,368)
Proceeds from the Sale of Hingham Water System	—		110,536
Investments in Unconsolidated Affiliates, Net	(245,245)		(31,677)
Other Investing Activities	17,436		17,647
Net Cash Flows Used in Investing Activities	(2,418,287)		(2,009,714)

Financing Activities:
Issuance of Common Shares, Net of Issuance Costs	—		929,025
Cash Dividends on Common Shares	(603,611)		(555,655)
Cash Dividends on Preferred Stock	(5,639)		(5,639)
Decrease in Notes Payable	(458,325)		(1,174,870)
Repayment of Rate Reduction Bonds	(43,210)		(43,210)
Issuance of Long-Term Debt	3,150,000		2,360,000
Retirement of Long-Term Debt	(1,142,500)		(302,236)
Other Financing Activities	(45,522)		18,030
Net Cash Flows Provided by Financing Activities	851,193		1,225,445
Net (Decrease)/Increase in Cash and Restricted Cash	(46,821)		711,940
Cash and Restricted Cash - Beginning of Period	264,950		117,063
Cash and Restricted Cash - End of Period	$	218,129	$	829,003

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

~~PUBLIC SERVICE~~

THE CONNECTICUT LIGHT AND POWER COMPANY

CONDENSED BALANCE SHEETS

(Unaudited)


(Thousands of Dollars)	As of September 30, 2021		As of December 31, 2020

ASSETS
Current Assets:
Cash	$	62,791	$	90,801
Receivables, Net (net of allowance for uncollectible accounts of $195,463 and $157,447 as of September 30, 2021 and December 31, 2020, respectively)	549,144		459,214
Accounts Receivable from Affiliated Companies	38,544		17,486
Unbilled Revenues	52,589		57,407
Materials and Supplies	54,894		57,924
Regulatory Assets	325,268		345,622
Prepaid Property Taxes	76,829		25,779
Prepayments and Other Current Assets	47,402		58,171
Total Current Assets	1,207,461		1,112,404
Property, Plant and Equipment, Net	10,598,836		10,234,556
Deferred Debits and Other Assets:
Regulatory Assets	1,981,805		1,866,152
Other Long-Term Assets	267,312		242,862
Total Deferred Debits and Other Assets	2,249,117		2,109,014
Total Assets	$	14,055,414	$	13,455,974

LIABILITIES AND CAPITALIZATION
Current Liabilities:


Accounts Payable	$	473,287	$	451,240
Accounts Payable to Affiliated Companies	98,298		51,118
Obligations to Third Party Suppliers	53,183		49,967
Regulatory Liabilities	311,269		137,166

Derivative Liabilities	72,249		68,767
Other Current Liabilities	168,547		102,060
Total Current Liabilities	1,176,833		860,318
Deferred Credits and Other Liabilities:
Accumulated Deferred Income Taxes	1,495,407		1,408,343
Regulatory Liabilities	1,213,469		1,204,942
Derivative Liabilities	256,569		294,535
Accrued Pension, SERP and PBOP	313,206		478,325
Other Long-Term Liabilities	154,249		133,690
Total Deferred Credits and Other Liabilities	3,432,900		3,519,835
Long-Term Debt	4,215,096		3,914,835
Preferred Stock Not Subject to Mandatory Redemption	116,200		116,200
Common Stockholder's Equity:
Common Stock	60,352		60,352
Capital Surplus, Paid In	2,810,765		2,810,765
Retained Earnings	2,243,004		2,173,367
Accumulated Other Comprehensive Income	264		302
Common Stockholder's Equity	5,114,385		5,044,786
Commitments and Contingencies (Note 9)	0		0
Total Liabilities and Capitalization	$	14,055,414	$	13,455,974

The accompanying notes are an integral part of these unaudited condensed financial statements.

THE CONNECTICUT LIGHT AND POWER COMPANY

CONDENSED STATEMENTS OF ~~NEW HAMPSHIRE~~INCOME

(Unaudited)


	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
(Thousands of Dollars)	2021		2020		2021		2020

Operating Revenues	$	919,643	$	994,270	$	2,736,513	$	2,711,394

Operating Expenses:
Purchased Power and Transmission	392,301		399,117		1,073,712		1,089,232
Operations and Maintenance	137,816		147,487		465,630		417,717
Depreciation	85,304		80,583		253,132		238,735
Amortization of Regulatory Assets, Net	28,921		36,365		76,637		37,215
Energy Efficiency Programs	35,714		41,829		100,810		109,655
Taxes Other Than Income Taxes	99,901		97,715		275,178		260,571
Total Operating Expenses	779,957		803,096		2,245,099		2,153,125
Operating Income	139,686		191,174		491,414		558,269
Interest Expense	42,778		38,369		124,371		114,972
Other Income, Net	6,903		5,917		21,690		16,273
Income Before Income Tax Expense	103,811		158,722		388,733		459,570
Income Tax Expense	33,658		38,625		104,626		103,464
Net Income	$	70,153	$	120,097	$	284,107	$	356,106

The accompanying notes are an integral part of these unaudited condensed financial statements.

CONDENSED STATEMENTS OF COMPREHENSIVE INCOME

(Unaudited)


	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
(Thousands of Dollars)	2021		2020		2021		2020

Net Income	$	70,153	$	120,097	$	284,107	$	356,106
Other Comprehensive Loss, Net of Tax:
Qualified Cash Flow Hedging Instruments	(7)		(7)		(20)		(20)
Changes in Unrealized (Losses)/Gains on Marketable Securities	(2)		(4)		(18)		11
Other Comprehensive Loss, Net of Tax	(9)		(11)		(38)		(9)
Comprehensive Income	$	70,144	$	120,086	$	284,069	$	356,097

The accompanying notes are an integral part of these unaudited condensed financial statements.

THE CONNECTICUT LIGHT AND POWER COMPANY

CONDENSED STATEMENTS OF COMMON STOCKHOLDER'S EQUITY

(Unaudited)


	For the Nine Months Ended September 30, 2021
	Common Stock			Capital Surplus, Paid In		Retained Earnings		Accumulated Other Comprehensive Income		Total Common Stockholder's Equity
(Thousands of Dollars, Except Stock Information)	Stock	Amount
Balance as of January 1, 2021	6,035,205	$	60,352	$	2,810,765	$	2,173,367	$	302	$	5,044,786
Net Income						98,398				98,398
Dividends on Preferred Stock						(1,390)				(1,390)
Dividends on Common Stock						(70,100)				(70,100)

Other Comprehensive Loss								(32)		(32)
Balance as of March 31, 2021	6,035,205	60,352		2,810,765		2,200,275		270		5,071,662
Net Income						115,556				115,556
Dividends on Preferred Stock						(1,390)				(1,390)
Dividends on Common Stock						(70,100)				(70,100)
Other Comprehensive Income								3		3
Balance as of June 30, 2021	6,035,205	60,352		2,810,765		2,244,341		273		5,115,731
Net Income						70,153				70,153
Dividends on Preferred Stock						(1,390)				(1,390)
Dividends on Common Stock						(70,100)				(70,100)
Other Comprehensive Loss								(9)		(9)
Balance as of September 30, 2021	6,035,205	$	60,352	$	2,810,765	$	2,243,004	$	264	$	5,114,385


	For the Nine Months Ended September 30, 2020
	Common Stock			Capital Surplus, Paid In		Retained Earnings		Accumulated Other Comprehensive Income		Total Common Stockholder's Equity
(Thousands of Dollars, Except Stock Information)	Stock	Amount
Balance as of January 1, 2020	6,035,205	$	60,352	$	2,535,765	$	1,791,392	$	316	$	4,387,825
Net Income						118,738				118,738
Dividends on Preferred Stock						(1,390)				(1,390)
Dividends on Common Stock						(69,500)				(69,500)
Adoption of Accounting Standards Update 2016-13						(900)				(900)
Other Comprehensive Loss								(1)		(1)
Balance as of March 31, 2020	6,035,205	60,352		2,535,765		1,838,340		315		4,434,772
Net Income						117,271				117,271
Dividends on Preferred Stock						(1,390)				(1,390)
Other Comprehensive Income								3		3
Balance as of June 30, 2020	6,035,205	60,352		2,535,765		1,954,221		318		4,550,656
Net Income						120,097				120,097
Dividends on Preferred Stock						(1,390)				(1,390)
Capital Contributions from Eversource Parent				125,000						125,000
Other Comprehensive Loss								(11)		(11)
Balance as of September 30, 2020	6,035,205	$	60,352	$	2,660,765	$	2,072,928	$	307	$	4,794,352

The accompanying notes are an integral part of these unaudited condensed financial statements.

THE CONNECTICUT LIGHT AND POWER COMPANY

CONDENSED STATEMENTS OF CASH FLOWS

(Unaudited)


	For the Nine Months Ended September 30,
(Thousands of Dollars)	2021		2020

Operating Activities:
Net Income	$	284,107	$	356,106
Adjustments to Reconcile Net Income to Net Cash Flows Provided by Operating Activities:
Depreciation	253,132		238,735
Deferred Income Taxes	77,147		92,590
Uncollectible Expense	10,183		10,013
Pension, SERP, and PBOP Expense, Net	4,478		8,629
Pension Contributions	(78,913)		(23,200)
Regulatory Underrecoveries, Net	(19,404)		(32,051)
Charges related to PURA Settlement Agreement and Storm Performance Penalty	103,583		—
Amortization of Regulatory Assets, Net	76,637		37,215
Other	(74,179)		(63,525)
Changes in Current Assets and Liabilities:
Receivables and Unbilled Revenues, Net	(165,423)		(153,464)
Taxes Receivable/Accrued, Net	45,762		(1,515)
Accounts Payable	(54,226)		(1,976)
Other Current Assets and Liabilities, Net	(12,315)		(68,316)
Net Cash Flows Provided by Operating Activities	450,569		399,241

Investing Activities:
Investments in Property, Plant and Equipment	(563,234)		(609,690)
Other Investing Activities	251		496
Net Cash Flows Used in Investing Activities	(562,983)		(609,194)

Financing Activities:
Cash Dividends on Common Stock	(210,300)		(69,500)
Cash Dividends on Preferred Stock	(4,169)		(4,169)
Capital Contributions from Eversource Parent	—		125,000
Issuance of Long-Term Debt	425,000		—
Retirement of Long-Term Debt	(120,500)		—
Increase in Notes Payable to Eversource Parent	—		172,100
Other Financing Activities	(5,664)		(1,214)
Net Cash Flows Provided by Financing Activities	84,367		222,217
Net (Decrease)/Increase in Cash and Restricted Cash	(28,047)		12,264
Cash and Restricted Cash - Beginning of Period	99,809		4,971
Cash and Restricted Cash - End of Period	$	71,762	$	17,235

The accompanying notes are an integral part of these unaudited condensed financial statements.

NSTAR ELECTRIC COMPANY AND SUBSIDIARY

CONDENSED CONSOLIDATED ~~STATEMENTS OF INCOME~~BALANCE SHEETS

(Unaudited)


(Thousands of Dollars)	As of September 30, 2021		As of December 31, 2020

ASSETS
Current Assets:
Cash	$	3,538	$	102
Receivables, Net (net of allowance for uncollectible accounts of $105,020 and $91,583 as of September 30, 2021 and December 31, 2020, respectively)	489,503		403,045
Accounts Receivable from Affiliated Companies	27,417		30,095
Unbilled Revenues	47,844		38,342
Materials, Supplies and REC Inventory	83,667		133,894
Taxes Receivable	—		65,051
Regulatory Assets	388,408		399,882
Prepayments and Other Current Assets	22,490		21,833
Total Current Assets	1,062,867		1,092,244
Property, Plant and Equipment, Net	10,611,728		10,123,062
Deferred Debits and Other Assets:
Regulatory Assets	1,247,715		1,304,019
Prepaid PBOP	224,244		204,138
Other Long-Term Assets	185,555		162,836
Total Deferred Debits and Other Assets	1,657,514		1,670,993
Total Assets	$	13,332,109	$	12,886,299

LIABILITIES AND CAPITALIZATION
Current Liabilities:
Notes Payable	$	138,000	$	195,000
Notes Payable to Eversource Parent	24,600		21,300
Long-Term Debt – Current Portion	—		250,000
Accounts Payable	338,369		383,558
Accounts Payable to Affiliated Companies	78,974		95,703
Obligations to Third Party Suppliers	137,211		98,572
Renewable Portfolio Standards Compliance Obligations	72,124		127,536
Regulatory Liabilities	205,771		164,761
Other Current Liabilities	118,747		72,118
Total Current Liabilities	1,113,796		1,408,548
Deferred Credits and Other Liabilities:
Accumulated Deferred Income Taxes	1,494,976		1,459,906
Regulatory Liabilities	1,561,572		1,550,390
Accrued Pension and SERP	110,752		172,571
Other Long-Term Liabilities	344,088		337,245
Total Deferred Credits and Other Liabilities	3,511,388		3,520,112
Long-Term Debt	3,984,724		3,393,221
Preferred Stock Not Subject to Mandatory Redemption	43,000		43,000
Common Stockholder's Equity:
Common Stock	—		—
Capital Surplus, Paid In	2,053,942		1,993,942
Retained Earnings	2,624,784		2,527,167
Accumulated Other Comprehensive Income	475		309
Common Stockholder's Equity	4,679,201		4,521,418
Commitments and Contingencies (Note 9)	0		0
Total Liabilities and Capitalization	$	13,332,109	$	12,886,299

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

Operating Revenues $ 250,032
$ 266,946
$ 733,572
$ 727,753

Operating Expenses:
Purchased Power, Fuel and Transmission 57,099
59,833
179,289
155,700
Operations and Maintenance 63,669
64,183
191,153
187,184
Depreciation 32,084
29,646
95,266
86,524
Amortization of Regulatory Assets/(Liabilities), Net 2,835
14,158
(10,658 ) 14,490
Energy Efficiency Programs 4,007
3,983
11,040
10,862
Taxes Other Than Income Taxes 22,936
20,460
66,935
64,543
Total Operating Expenses 182,630
192,263
533,025
519,303
Operating Income 67,402
74,683
200,547
208,450
Interest Expense 12,896
12,397
38,676
37,386
Other Income, Net 1,229
574
2,883
1,007
Income Before Income Tax Expense 55,735
62,860
164,754
172,071
Income Tax Expense 22,012
24,345
65,128
66,242
Net Income $ 33,723
$ 38,515
$ 99,626
$ 105,829

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

NSTAR ELECTRIC COMPANY AND SUBSIDIARY

CONDENSED CONSOLIDATED STATEMENTS OF ~~COMPREHENSIVE~~ INCOME

(Unaudited)


	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
(Thousands of Dollars)	2021		2020		2021		2020

Operating Revenues	$	918,698	$	875,371	$	2,343,116	$	2,270,174

Operating Expenses:
Purchased Power and Transmission	294,052		267,375		711,667		702,117
Operations and Maintenance	142,074		131,143		421,649		369,293
Depreciation	84,820		80,366		251,530		238,232
Amortization of Regulatory Assets, Net	8,073		22,527		23,963		69,139
Energy Efficiency Programs	86,699		85,244		226,071		210,666
Taxes Other Than Income Taxes	54,723		54,680		163,501		153,985
Total Operating Expenses	670,441		641,335		1,798,381		1,743,432
Operating Income	248,257		234,036		544,735		526,742
Interest Expense	37,329		31,029		106,829		95,000
Other Income, Net	20,215		12,802		58,941		38,152
Income Before Income Tax Expense	231,143		215,809		496,847		469,894
Income Tax Expense	53,692		50,081		114,560		106,309
Net Income	$	177,451	$	165,728	$	382,287	$	363,585

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

Net Income $ 33,723
$ 38,515
$ 99,626
$ 105,829
Other Comprehensive Income, Net of Tax:
Qualified Cash Flow Hedging Instruments 291
290
872
871
Changes in Unrealized (Losses)/Gains on
Marketable Securities
(112 ) 56
43
135
Other Comprehensive Income, Net of Tax 179
346
915
1,006
Comprehensive Income $ 33,902
$ 38,861
$ 100,541
$ 106,835

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

~~PUBLIC SERVICE COMPANY OF NEW HAMPSHIRE AND SUBSIDIARY~~

CONDENSED CONSOLIDATED STATEMENTS OF ~~CASH FLOWS~~COMPREHENSIVE INCOME

(Unaudited)


	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
(Thousands of Dollars)	2021		2020		2021		2020

Net Income	$	177,451	$	165,728	$	382,287	$	363,585
Other Comprehensive (Loss)/Income, Net of Tax:
Changes in Funded Status of SERP Benefit Plan	(40)		(43)		(122)		(129)
Qualified Cash Flow Hedging Instruments	5		109		293		327
Changes in Unrealized (Losses)/Gains on Marketable Securities	(1)		(1)		(5)		2
Other Comprehensive (Loss)/Income, Net of Tax	(36)		65		166		200
Comprehensive Income	$	177,415	$	165,793	$	382,453	$	363,785

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

Operating Activities:
Net Income $ 99,626
$ 105,829
Adjustments to Reconcile Net Income to Net Cash Flows Provided by Operating Activities:
Depreciation 95,266
86,524
Deferred Income Taxes 43,217
74,522
Regulatory Over/(Under) Recoveries, Net 8,910
(4,289 )
Amortization of Regulatory (Liabilities)/Assets, Net (10,658 ) 14,490
Other (7,792 ) (12,660 )
Changes in Current Assets and Liabilities:
Receivables and Unbilled Revenues, Net (30,276 ) (28,754 )
Fuel, Materials, Supplies and Inventory 4,263
(4,014 )
Taxes Receivable/Accrued, Net 10,749
33,589
Accounts Payable 18,394
14,508
Other Current Assets and Liabilities, Net 32,296
26,207
Net Cash Flows Provided by Operating Activities 263,995
305,952

Investing Activities:
Investments in Property, Plant and Equipment (215,470 ) (215,804 )
Other Investing Activities 113
272
Net Cash Flows Used in Investing Activities (215,357 ) (215,532 )

Financing Activities:
Cash Dividends on Common Stock (23,900 ) (58,200 )
Capital Contributions from Eversource Parent —
94,500
Retirements of Long-Term Debt (70,000 ) —
Increase/(Decrease) in Notes Payable to Eversource Parent 41,400
(123,800 )
Other Financing Activities (187 ) (217 )
Net Cash Flows Used in Financing Activities (52,687 ) (87,717 )
Net (Decrease)/Increase in Cash (4,049 ) 2,703
Cash - Beginning of Period 4,646
1,733
Cash - End of Period $ 597
$ 4,436

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

~~WESTERN MASSACHUSETTS~~NSTAR ELECTRIC COMPANY AND SUBSIDIARY

CONDENSED ~~BALANCE SHEETS~~CONSOLIDATED STATEMENTS OF COMMON STOCKHOLDER'S EQUITY

(Unaudited)


	For the Nine Months Ended September 30, 2021
	Common Stock			Capital Surplus, Paid In		Retained Earnings		Accumulated Other Comprehensive Income		Total Common Stockholder's Equity
(Thousands of Dollars, Except Stock Information)	Stock	Amount
Balance as of January 1, 2021	200	$	—	$	1,993,942	$	2,527,167	$	309	$	4,521,418
Net Income						93,924				93,924
Dividends on Preferred Stock						(490)				(490)
Dividends on Common Stock						(206,400)				(206,400)

Other Comprehensive Income								61		61
Balance as of March 31, 2021	200	—		1,993,942		2,414,201		370		4,408,513
Net Income						110,912				110,912
Dividends on Preferred Stock						(490)				(490)
Dividends on Common Stock						(76,800)				(76,800)
Capital Contributions from Eversource Parent				60,000						60,000
Other Comprehensive Income								141		141
Balance as of June 30, 2021	200	—		2,053,942		2,447,823		511		4,502,276
Net Income						177,451				177,451
Dividends on Preferred Stock						(490)				(490)
Other Comprehensive Loss								(36)		(36)
Balance as of September 30, 2021	200	$	—	$	2,053,942	$	2,624,784	$	475	$	4,679,201

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

ASSETS
Current Assets:
Receivables, Net $ 58,034
$ 54,940
Accounts Receivable from Affiliated Companies 23,440
14,425
Unbilled Revenues 15,000
15,329
Materials, Supplies and Inventory 6,221
8,618
Regulatory Assets 60,606
64,123
Prepayments and Other Current Assets 1,297
2,595
Total Current Assets 164,598
160,030

Property, Plant and Equipment, Net 1,769,566
1,678,262

Deferred Debits and Other Assets:
Regulatory Assets 121,796
127,291
Other Long-Term Assets 38,934
29,062
Total Deferred Debits and Other Assets 160,730
156,353

Total Assets $ 2,094,894
$ 1,994,645

LIABILITIES AND CAPITALIZATION
Current Liabilities:
Notes Payable to Eversource Parent $ 96,900
$ 51,000
Accounts Payable 58,518
56,036
Accounts Payable to Affiliated Companies 22,181
19,478
Obligations to Third Party Suppliers 9,736
10,508
Renewable Portfolio Standards Compliance Obligations 16,144
20,383
Regulatory Liabilities 10,236
14,888
Other Current Liabilities 13,020
14,984
Total Current Liabilities 226,735
187,277

Deferred Credits and Other Liabilities:

Accumulated Deferred Income Taxes 519,998
490,793
Regulatory Liabilities 22,726
17,227
Accrued Pension, SERP and PBOP 18,038
20,390
Other Long-Term Liabilities 45,831
41,308
Total Deferred Credits and Other Liabilities 606,593
569,718

Capitalization:

Long-Term Debt 566,172
566,536

Common Stockholder's Equity:

Common Stock 10,866
10,866
Capital Surplus, Paid In 444,398
444,398
Retained Earnings 242,157
218,212
Accumulated Other Comprehensive Loss (2,027 ) (2,362 )
Common Stockholder's Equity 695,394
671,114
Total Capitalization 1,261,566
1,237,650

Total Liabilities and Capitalization $ 2,094,894
$ 1,994,645


	For the Nine Months Ended September 30, 2020
	Common Stock			Capital Surplus, Paid In		Retained Earnings		Accumulated Other Comprehensive Income		Total Common Stockholder's Equity
(Thousands of Dollars, Except Stock Information)	Stock	Amount
Balance as of January 1, 2020	200	$	—	$	1,813,442	$	2,346,287	$	155	$	4,159,884
Net Income						100,390				100,390
Dividends on Preferred Stock						(490)				(490)
Dividends on Common Stock						(196,500)				(196,500)
Adoption of Accounting Standards Update 2016-13						(161)				(161)
Other Comprehensive Income								67		67
Balance as of March 31, 2020	200	—		1,813,442		2,249,526		222		4,063,190
Net Income						97,468				97,468
Dividends on Preferred Stock						(490)				(490)
Other Comprehensive Income								68		68
Balance as of June 30, 2020	200	—		1,813,442		2,346,504		290		4,160,236
Net Income						165,728				165,728
Dividends on Preferred Stock						(490)				(490)
Other Comprehensive Income								65		65
Balance as of September 30, 2020	200	$	—	$	1,813,442	$	2,511,742	$	355	$	4,325,539

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

~~WESTERN MASSACHUSETTS~~

NSTAR ELECTRIC COMPANY AND SUBSIDIARY

CONDENSED CONSOLIDATED STATEMENTS OF ~~INCOME~~CASH FLOWS

(Unaudited)


	For the Nine Months Ended September 30,
(Thousands of Dollars)	2021		2020

Operating Activities:
Net Income	$	382,287	$	363,585
Adjustments to Reconcile Net Income to Net Cash Flows Provided by Operating Activities:
Depreciation	251,530		238,232
Deferred Income Taxes	12,905		13,436
Uncollectible Expense	12,477		11,321
Pension, SERP and PBOP Income, Net	(19,627)		(13,714)
Pension Contributions	(10,000)		(650)
Regulatory Over/(Under) Recoveries, Net	86,111		(20,047)
Amortization of Regulatory Assets, Net	23,963		69,139
Other	(71,005)		(25,508)
Changes in Current Assets and Liabilities:
Receivables and Unbilled Revenues, Net	(110,336)		(104,528)
Materials, Supplies and REC Inventory	50,227		27,709
Taxes Receivable/Accrued, Net	109,561		55,405
Accounts Payable	(85,431)		(57,300)
Other Current Assets and Liabilities, Net	(15,322)		(54,481)
Net Cash Flows Provided by Operating Activities	617,340		502,599

Investing Activities:
Investments in Property, Plant and Equipment	(675,245)		(655,039)
Other Investing Activities	70		138
Net Cash Flows Used in Investing Activities	(675,175)		(654,901)

Financing Activities:
Cash Dividends on Common Stock	(283,200)		(196,500)
Cash Dividends on Preferred Stock	(1,470)		(1,470)
Issuance of Long-Term Debt	600,000		400,000
Retirement of Long-Term Debt	(250,000)		(95,000)
Capital Contributions from Eversource Parent	60,000		—
Increase in Notes Payable to Eversource Parent	3,300		6,300
(Decrease)/Increase in Notes Payable	(57,000)		50,000
Other Financing Activities	(10,367)		(4,931)
Net Cash Flows Provided by Financing Activities	61,263		158,399
Net Increase in Cash and Restricted Cash	3,428		6,097
Cash and Restricted Cash - Beginning of Period	17,410		6,312
Cash and Restricted Cash - End of Period	$	20,838	$	12,409

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

Operating Revenues $ 126,335
$ 124,042
$ 377,214
$ 368,533

Operating Expenses:
Purchased Power and Transmission 34,828
32,178
109,553
104,406
Operations and Maintenance 21,528
24,125
65,769
68,018
Depreciation 12,546
11,567
36,844
34,414
Amortization of Regulatory Assets/(Liabilities), Net 286
1,102
(563 ) 3,305
Energy Efficiency Programs 10,996
12,389
29,739
33,593
Taxes Other Than Income Taxes 10,779
10,609
31,403
30,440
Total Operating Expenses 90,963
91,970
272,745
274,176
Operating Income 35,372
32,072
104,469
94,357
Interest Expense 6,321
6,222
18,752
18,298
Other Income, Net 1,060
179
1,409
133
Income Before Income Tax Expense 30,111
26,029
87,126
76,192
Income Tax Expense 12,504
10,018
34,680
30,089
Net Income $ 17,607
$ 16,011
$ 52,446
$ 46,103

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

PUBLIC SERVICE COMPANY OF NEW HAMPSHIRE AND SUBSIDIARIES

CONDENSED ~~STATEMENTS OF COMPREHENSIVE INCOME~~CONSOLIDATED BALANCE SHEETS

(Unaudited)


(Thousands of Dollars)	As of September 30, 2021		As of December 31, 2020

ASSETS
Current Assets:
Cash	$	3,869	$	141
Receivables, Net (net of allowance for uncollectible accounts of $16,996 and $17,157 as of September 30, 2021 and December 31, 2020, respectively)	136,481		119,899
Accounts Receivable from Affiliated Companies	13,866		10,925
Unbilled Revenues	46,854		46,041

Materials, Supplies and REC Inventory	24,789		26,829
Regulatory Assets	97,948		115,852
Special Deposits	18,605		36,767
Prepaid Property Taxes	5,987		26,257
Prepayments and Other Current Assets	2,851		10,788
Total Current Assets	351,250		393,499
Property, Plant and Equipment, Net	3,529,050		3,374,270
Deferred Debits and Other Assets:
Regulatory Assets	829,848		873,203
Other Long-Term Assets	22,684		23,733
Total Deferred Debits and Other Assets	852,532		896,936
Total Assets	$	4,732,832	$	4,664,705

LIABILITIES AND CAPITALIZATION
Current Liabilities:
Notes Payable to Eversource Parent	$	66,500	$	46,300
Long-Term Debt – Current Portion	—		282,000
Rate Reduction Bonds – Current Portion	43,210		43,210
Accounts Payable	108,243		132,635
Accounts Payable to Affiliated Companies	25,055		43,397
Regulatory Liabilities	96,817		58,756

Other Current Liabilities	61,883		58,487
Total Current Liabilities	401,708		664,785
Deferred Credits and Other Liabilities:
Accumulated Deferred Income Taxes	535,656		537,627
Regulatory Liabilities	389,426		383,183
Accrued Pension, SERP and PBOP	162,115		184,715
Other Long-Term Liabilities	35,564		37,874
Total Deferred Credits and Other Liabilities	1,122,761		1,143,399
Long-Term Debt	1,163,630		817,070
Rate Reduction Bonds	453,702		496,912
Common Stockholder's Equity:
Common Stock	—		—
Capital Surplus, Paid In	1,088,134		928,134
Retained Earnings	502,870		615,018
Accumulated Other Comprehensive Income/(Loss)	27		(613)
Common Stockholder's Equity	1,591,031		1,542,539
Commitments and Contingencies (Note 9)	0		0
Total Liabilities and Capitalization	$	4,732,832	$	4,664,705

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

Net Income $ 17,607
$ 16,011
$ 52,446
$ 46,103
Other Comprehensive Income, Net of Tax:

Qualified Cash Flow Hedging Instruments 109
109
328
328
Changes in Unrealized (Losses)/Gains on
Marketable Securities
(18 ) 9
7
22
Other Comprehensive Income, Net of Tax 91
118
335
350
Comprehensive Income $ 17,698
$ 16,129
$ 52,781
$ 46,453

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

~~WESTERN MASSACHUSETTS ELECTRIC~~

PUBLIC SERVICE COMPANY OF NEW HAMPSHIRE AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF ~~CASH FLOWS~~INCOME

(Unaudited)


	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
(Thousands of Dollars)	2021		2020		2021		2020

Operating Revenues	$	314,893	$	283,669	$	887,177	$	815,261

Operating Expenses:
Purchased Power and Transmission	107,353		96,612		279,475		273,311
Operations and Maintenance	57,041		50,657		168,242		151,802
Depreciation	30,169		25,410		89,462		74,494
Amortization of Regulatory Assets, Net	17,922		7,360		62,744		39,034
Energy Efficiency Programs	10,762		11,081		30,475		29,231
Taxes Other Than Income Taxes	24,038		18,174		69,639		58,331
Total Operating Expenses	247,285		209,294		700,037		626,203
Operating Income	67,608		74,375		187,140		189,058
Interest Expense	14,321		14,942		42,774		44,029
Other Income, Net	3,171		4,065		11,598		10,882
Income Before Income Tax Expense	56,458		63,498		155,964		155,911
Income Tax Expense	12,315		16,347		32,512		37,527
Net Income	$	44,143	$	47,151	$	123,452	$	118,384

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

Operating Activities:
Net Income $ 52,446
$ 46,103
Adjustments to Reconcile Net Income to Net Cash Flows Provided by Operating Activities:
Depreciation 36,844
34,414
Deferred Income Taxes 29,008
15,587
Regulatory Overrecoveries, Net 10,291
323
Amortization of Regulatory (Liabilities)/Assets, Net (563 ) 3,305
Other (10,182 ) (2,532 )
Changes in Current Assets and Liabilities:
Receivables and Unbilled Revenues, Net (16,818 ) 1,933
Taxes Receivable/Accrued, Net 4,203
36,658
Accounts Payable (5,777 ) (16,240 )
Other Current Assets and Liabilities, Net (7,482 ) 5,277
Net Cash Flows Provided by Operating Activities 91,970
124,828

Investing Activities:
Investments in Property, Plant and Equipment (109,233 ) (104,811 )
Proceeds from Sales of Marketable Securities 1,641
1,934
Purchases of Marketable Securities (1,590 ) (1,894 )
Net Cash Flows Used in Investing Activities (109,182 ) (104,771 )

Financing Activities:
Cash Dividends on Common Stock (28,500 ) (28,500 )
Capital Contributions from Eversource Parent —
53,000
Increase/(Decrease) in Notes Payable to Eversource Parent 45,900
(95,200 )
Issuance of Long-Term Debt —
50,000
Other Financing Activities (188 ) (191 )
Net Cash Flows Provided by/(Used in) Financing Activities 17,212
(20,891 )
Net Decrease in Cash —
(834 )
Cash - Beginning of Period —
834
Cash - End of Period $ —
$ —

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Unaudited)


	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
(Thousands of Dollars)	2021		2020		2021		2020

Net Income	$	44,143	$	47,151	$	123,452	$	118,384
Other Comprehensive Income, Net of Tax:
Qualified Cash Flow Hedging Instruments	109		268		673		806
Changes in Unrealized (Losses)/Gains on Marketable Securities	(6)		(8)		(33)		17
Other Comprehensive Income, Net of Tax	103		260		640		823
Comprehensive Income	$	44,246	$	47,411	$	124,092	$	119,207

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

PUBLIC SERVICE COMPANY OF NEW HAMPSHIRE AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF COMMON STOCKHOLDER'S EQUITY

(Unaudited)


	For the Nine Months Ended September 30, 2021
	Common Stock			Capital Surplus, Paid In		Retained Earnings		Accumulated Other Comprehensive (Loss)/Income		Total Common Stockholder's Equity
(Thousands of Dollars, Except Stock Information)	Stock	Amount
Balance as of January 1, 2021	301	$	—	$	928,134	$	615,018	$	(613)	$	1,542,539
Net Income						44,676				44,676
Dividends on Common Stock						(25,200)				(25,200)

Other Comprehensive Income								255		255
Balance as of March 31, 2021	301	—		928,134		634,494		(358)		1,562,270
Net Income						34,633				34,633
Dividends on Common Stock						(185,200)				(185,200)
Capital Contributions from Eversource Parent				160,000						160,000
Other Comprehensive Income								282		282
Balance as of June 30, 2021	301	—		1,088,134		483,927		(76)		1,571,985
Net Income						44,143				44,143
Dividends on Common Stock						(25,200)				(25,200)
Other Comprehensive Income								103		103
Balance as of September 30, 2021	301	$	—	$	1,088,134	$	502,870	$	27	$	1,591,031


	For the Nine Months Ended September 30, 2020
	Common Stock			Capital Surplus, Paid In		Retained Earnings		Accumulated Other Comprehensive Loss		Total Common Stockholder's Equity
(Thousands of Dollars, Except Stock Information)	Stock	Amount
Balance as of January 1, 2020	301	$	—	$	903,134	$	490,306	$	(1,707)	$	1,391,733
Net Income						39,601				39,601
Dividends on Common Stock						(22,300)				(22,300)
Adoption of Accounting Standards Update 2016-13						(300)				(300)
Other Comprehensive Income								278		278
Balance as of March 31, 2020	301	—		903,134		507,307		(1,429)		1,409,012
Net Income						31,632				31,632
Other Comprehensive Income								285		285
Balance as of June 30, 2020	301	—		903,134		538,939		(1,144)		1,440,929
Net Income						47,151				47,151
Other Comprehensive Income								260		260
Balance as of September 30, 2020	301	$	—	$	903,134	$	586,090	$	(884)	$	1,488,340

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

PUBLIC SERVICE COMPANY OF NEW HAMPSHIRE AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)


	For the Nine Months Ended September 30,
(Thousands of Dollars)	2021		2020

Operating Activities:
Net Income	$	123,452	$	118,384
Adjustments to Reconcile Net Income to Net Cash Flows Provided by Operating Activities:
Depreciation	89,462		74,494
Deferred Income Taxes	(13,385)		13,959
Uncollectible Expense	4,381		2,058
Regulatory Over/(Under) Recoveries, Net	29,029		(22,203)
Amortization of Regulatory Assets, Net	62,744		39,034
Pension, SERP and PBOP Income, Net	(2,664)		(894)
Pension Contributions	—		(19,500)
Other	(22,738)		(7,545)
Changes in Current Assets and Liabilities:
Receivables and Unbilled Revenues, Net	(25,607)		(24,562)
Materials, Supplies and REC Inventory	2,040		(301)
Taxes Receivable/Accrued, Net	22,286		1,313
Accounts Payable	(42,654)		(29,388)
Other Current Assets and Liabilities, Net	10,826		4,363
Net Cash Flows Provided by Operating Activities	237,172		149,212

Investing Activities:
Investments in Property, Plant and Equipment	(217,414)		(248,899)
Other Investing Activities	431		1,969
Net Cash Flows Used in Investing Activities	(216,983)		(246,930)

Financing Activities:
Cash Dividends on Common Stock	(235,600)		(22,300)
Capital Contributions from Eversource Parent	160,000		—
Issuance of Long-Term Debt	350,000		150,000
Retirement of Long-Term Debt	(282,000)		—
Repayment of Rate Reduction Bonds	(43,210)		(43,210)
Increase in Notes Payable to Eversource Parent	20,200		2,100
Other Financing Activities	(2,961)		(2,965)
Net Cash Flows (Used in)/Provided by Financing Activities	(33,571)		83,625
Net Decrease in Cash and Restricted Cash	(13,382)		(14,093)
Cash and Restricted Cash - Beginning of Period	39,555		36,688
Cash and Restricted Cash - End of Period	$	26,173	$	22,595

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

EVERSOURCE ENERGY AND SUBSIDIARIES

THE CONNECTICUT LIGHT AND POWER COMPANY

NSTAR ELECTRIC COMPANY AND SUBSIDIARY

PUBLIC SERVICE COMPANY OF NEW HAMPSHIRE AND ~~SUBSIDIARY~~SUBSIDIARIES

~~WESTERN MASSACHUSETTS ELECTRIC COMPANY~~

COMBINED NOTES TO CONDENSED FINANCIAL STATEMENTS (Unaudited)

Refer to the Glossary of Terms included in this combined Quarterly Report on Form 10-Q for abbreviations and acronyms used throughout the combined notes to the unaudited condensed financial statements.

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

A. Basis of Presentation

Eversource Energy is a public utility holding company primarily engaged, through its wholly-owned regulated utility subsidiaries, in the energy delivery business. Eversource Energy's wholly-owned regulated utility subsidiaries consist of CL&P, NSTAR Electric and PSNH ~~WMECO,~~(electric utilities), Yankee Gas, NSTAR Gas and ~~NSTAR Gas.~~Eversource Gas Company of Massachusetts (EGMA) (natural gas utilities) and Aquarion (water utilities). Eversource provides energy delivery and/or water service to approximately ~~3.7~~4.3 million electric, ~~and~~ natural gas and water customers through ~~these six~~9 regulated utilities in Connecticut, Massachusetts and New Hampshire.

On June 2, 2017, Eversource announced that it had entered into an agreement to acquire Aquarion from Macquarie Infrastructure Partners for $1.675 billion, consisting of approximately $880 million in cash and $795 million of assumed Aquarion debt. The transaction requires approval from PURA, the DPU, the NHPUC, the Maine PUC, and the Federal Communications Commission, and is also subject to a review under the Hart-Scott-Rodino Act. On June 29, 2017, Eversource and Aquarion filed joint applications with regulatory agencies in Connecticut, Massachusetts, New Hampshire and Maine requesting approval of the transaction. With the exception of Massachusetts, all state and federal regulatory agency approvals have been received and the related review period has expired. The transaction is expected to close by December 31, 2017.

The unaudited condensed consolidated financial statements of Eversource, NSTAR Electric and PSNH include the accounts of each of their respective subsidiaries. Intercompany transactions have been eliminated in consolidation. The accompanying unaudited condensed consolidated financial statements of Eversource, NSTAR Electric and PSNH and the unaudited condensed financial statements of CL&P ~~and WMECO~~ are herein collectively referred to as the "financial statements."

The combined notes to the financial statements have been prepared pursuant to the rules and regulations of the SEC. Certain information and footnote disclosures included in annual financial statements prepared in accordance with GAAP have been omitted pursuant to such rules and regulations. The accompanying financial statements should be read in conjunction with the Combined Notes to Financial Statements included in Item 8, "Financial Statements and Supplementary Data," of the Eversource ~~2016~~2020 Form 10-K, which was filed with the ~~SEC.~~SEC on February 17, 2021. The preparation of the financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent liabilities as of the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

The financial statements contain, in the opinion of management, all adjustments (including normal, recurring adjustments) necessary to present fairly Eversource's, CL&P's, NSTAR Electric's ~~PSNH's~~ and ~~WMECO's~~PSNH's financial position as of September 30, ~~2017~~2021 and December 31, ~~2016,~~2020, and the results of operations, ~~and~~ comprehensive income and common shareholders' equity for the three and nine months ended September 30, ~~2017~~2021 and ~~2016,~~2020 and the cash flows for the nine months ended September 30, ~~2017~~2021 and ~~2016.~~2020. The results of operations and comprehensive income for the three and nine months ended September 30, ~~2017~~2021 and ~~2016~~2020 and the cash flows for the nine months ended September 30, ~~2017~~2021 and ~~2016~~2020 are not necessarily indicative of the results expected for a full year.

Eversource's consolidated financial information includes the results of the acquisition of the assets of Columbia Gas of Massachusetts (CMA) on October 9, 2020. The natural gas distribution assets acquired from CMA on October 9, 2020 were assigned to EGMA.

Eversource consolidates the operations of CYAPC and YAEC, both of which are inactive regional nuclear power companies engaged in the long-term storage of their spent nuclear fuel. Eversource consolidates CYAPC and YAEC because CL&P's, NSTAR Electric's ~~PSNH's~~ and ~~WMECO's~~PSNH's combined ownership ~~interest~~and voting interests in each of these entities is greater than 50 percent. Intercompany transactions between CL&P, NSTAR Electric, PSNH and ~~WMECO and~~ the CYAPC and YAEC companies have been eliminated in consolidation of the Eversource financial statements.

Eversource holds several equity ownership interests that are not consolidated and are accounted for under the equity method.

Eversource's utility subsidiaries' electric, natural gas and water distribution ~~(including generation assets)~~ and transmission businesses are subject to rate-regulation that is based on cost recovery and meets the criteria for application of accounting guidance for entities with rate-regulated operations, which considers the effect of regulation on the differences in the timing of the recognition of certain revenues and expenses from those of other businesses and industries. See Note 2, "Regulatory Accounting," for further information.

COVID-19 has adversely affected customers, workers and the U.S. economy. We provide a critical service to our customers and have taken extensive measures to maintain its safety and reliability. We continue to address the impacts of the COVID-19 pandemic and how the related developments affect Eversource. We are in the re-entry phase of our pandemic response plan, in which the majority of our employees under remote work arrangements have transitioned back to the workplace. We have not experienced significant impacts directly related to the pandemic that have materially affected our current operations, our workforce, or results of operations. The extent of the impact to us in the future will vary, and depend on the duration, scope and severity of the pandemic and the resulting impact on economic, health care and capital market conditions. The future impact will also depend on the outcome of future proceedings before our state regulatory commissions to recover our incremental costs associated with COVID-19, which include uncollectible customer receivable expenses.

Based on the status of our COVID-19 regulatory dockets, communications with our state regulatory commissions, and policies and practices in the jurisdictions in which we operate, we believe our state regulatory commissions in Connecticut and Massachusetts will allow us to recover our incremental costs associated with COVID-19, which include uncollectible customer receivable expenses, while balancing the impact on our customers’ bills and our operating cash flows. See Note 1C, "Summary of Significant Accounting Policies - Allowance for Uncollectible Accounts," for discussion of our evaluation of the allowance for doubtful accounts as of September 30, 2021 in light of the COVID-19 pandemic and Note 2, "Regulatory Accounting," for the amount of net incremental COVID-19 costs deferred on our balance sheets.

Certain reclassifications of prior period data were made in the accompanying financial statements to conform to the current period presentation.

B. Accounting Standards

Accounting Standards ~~Issued but Not Yet Effective:~~ ~~In May 2014,~~Recently Adopted: On January 1, 2021, the ~~Financial Accounting Standards Board ("FASB") issued an~~Company adopted Accounting Standards Update ~~("ASU") 2014-09,~~ ~~Revenue from Contracts with Customers~~(ASU) 2019-12, Income Taxes (Topic 740) - Simplifying the Accounting for Income Taxes, which ~~amends existing revenue recognition~~eliminates certain exceptions to the general principles of current income tax guidance in ASC 740 and ~~is required~~simplifies and improves consistency in application of that income tax guidance through clarifications of and amendments to be applied retrospectively (either to each reporting period presented or cumulatively at the date of initial application). The Company will implement the standard in the first quarter of 2018 cumulatively at the date of initial application. Implementation of the ASU is not expected to have a material effect on the financial statements of Eversource, CL&P, NSTAR Electric, PSNH or WMECO.

~~In January 2016, the FASB issued ASU 2016-01,~~ ~~Financial Instruments - Overall: Recognition and Measurement of Financial Assets and Liabilities, which is required to be implemented in the first quarter of 2018.~~ASC 740. The ASU will remove the available-for-sale designation for equity securities, whereby changes in fair value are recorded in accumulated other comprehensive income within shareholders' equity, and will require changes in fair value of all equity securities to be recorded in earnings beginning on January 1, 2018, with the unrealized gain or loss on available-for-sale equity securities as of that date reclassified to retained earnings as a cumulative effect of adoption. The fair value of available-for-sale equity securities subject to this guidance as of September 30, 2017 was approximately $51 million with an unrealized gain of $1.7 million. The remaining available-for-sale equity securities included in marketable securities on the balance sheet are held in nuclear decommissioning trusts and are subject to regulatory accounting treatment and willdid not ~~be impacted by this guidance. Implementation of the ASU for other financial instruments is not expected to~~ have a material impact on the financial statements of Eversource, CL&P, NSTAR Electric ~~PSNH or WMECO.~~and PSNH.

~~In February 2016, the FASB issued ASU 2016-02,~~ ~~Leases~~, which changes existing lease accounting guidance and is required to be applied in the first quarter of 2019, with earlier application permitted. The ASU lease criteria are required to be applied to leases and lease renewals entered into effective January 1, 2019, and leases entered into before that date are required to be recognized and measured using a modified retrospective approach. The Company is reviewing the requirements of ASU 2016-02, including balance sheet recognition of leases previously deemed to be operating leases, and expects to implement the ASU in the first quarter of 2019.

~~In March 2017, the FASB issued ASU 2017-07,~~ ~~Compensation – Retirement Benefits: Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost~~, required to be implemented in the first quarter of 2018. The ASU requires separate presentation of service cost from other components of net pension and PBOP costs, with the other components presented as non-operating income and not subject to capitalization. The ASU is required to be applied retrospectively for the separate presentation in the income statement of service costs and other components and prospectively in the balance sheet for the capitalization of only the service cost component. The implementation of the ASU will not have an impact on the net income of Eversource, CL&P, NSTAR Electric, PSNH or WMECO.

C. ~~Provision~~Allowance for Uncollectible Accounts

~~Eversource, including CL&P, NSTAR Electric, PSNH~~Receivables, Net on the balance sheets primarily includes trade receivables from retail customers and ~~WMECO, presents its~~customers related to wholesale transmission contracts, wholesale market sales, sales of RECs and property rentals. Receivables, Net also includes customer receivables for the purchase of electricity from a competitive third party supplier, the current portion of customer energy efficiency loans, property damage receivables and other miscellaneous receivables. There is no material concentration of receivables. Receivables are recorded at amortized cost, net of a credit loss provision (or allowance for uncollectible accounts).

Receivables are presented net of expected credit losses at estimated net realizable value by maintaining ~~a provision~~an allowance for uncollectible accounts. The current expected credit loss (CECL) model is applied to receivables for purposes of calculating the allowance for uncollectible accounts. This ~~provision~~model is based on expected losses and results in the recognition of estimated expected credit losses, including uncollectible amounts for both billed and unbilled revenues, over the life of the receivable at the time a receivable is recorded.

The allowance for uncollectible accounts is determined based upon a variety of judgments and factors, including the application of an estimated uncollectible percentage to each receivable aging category. ~~The estimate is based upon~~Factors in determining credit loss include historical collection, ~~and~~ write-off experience, and management's assessment of collectability from ~~customers.~~customers, including current conditions, reasonable forecasts, and expectations of future collectability and collection efforts. Management continuously assesses the collectability of receivables and adjusts ~~collectability~~ estimates based on actual ~~experience.~~experience and future expectations based on economic indicators, collection efforts and other factors. Management also monitors the aging analysis of receivables to determine if there are changes in the collections of accounts receivable. Receivable balances are written off against the ~~provision~~allowance for uncollectible accounts when the customer accounts are ~~terminated~~no longer in service and these balances are deemed to be uncollectible.

As of September 30, 2021, management evaluated the adequacy of the allowance for uncollectible accounts in light of the COVID-19 pandemic and the related economic downturn. This evaluation included an analysis of collection and customer payment trends, economic conditions, delinquency statistics, aging-based quantitative assessments, the impact on residential customer bills because of energy usage and change in rates, flexible payment plans and financial hardship arrearage management programs being offered to customers, and COVID-19 developments, including any potential federal governmental pandemic relief programs and the expansion of unemployment benefit initiatives, which help to mitigate the potential for increasing customer account delinquencies. Additionally, management considered past economic declines and corresponding uncollectible reserves as part of the current assessment.

This evaluation has shown that our operating companies have experienced an increase in aged receivables and lower cash collections from customers because of the length of the moratorium on disconnections in Connecticut and Massachusetts, and the economic slowdown resulting from the COVID-19 pandemic. In Connecticut, the moratorium on disconnections of commercial and non-hardship residential customers ended in June 2021 and September 2021, respectively, but is still in place for hardship residential customers. In Massachusetts, the moratorium on disconnections of commercial customers and residential customers ended in September 2020 and July 2021, respectively. Disconnection activities have resumed after these moratoria have expired, which has resulted in recent improved collection experience and more customers applying for, and receiving, hardship status. On July 7, 2021, the NHPUC issued an order to New Hampshire utilities that concluded that recovery of incremental bad debt or waived late fees related to the COVID-19 pandemic would be addressed in a future rate case to the extent those costs are relevant at that time. As a result of the order, in the first nine months of 2021, PSNH removed its $0.6 million deferral of net incremental COVID-19 costs. In New Hampshire, the moratorium on disconnections of non-hardship residential and commercial customers ended in late 2020 and for hardship residential customers ended in May 2021 and PSNH has resumed disconnection activities, which has resulted in improved collection of outstanding customer receivable balances.

Based upon the evaluation performed, in the first nine months of 2021, management increased the allowance for uncollectible accounts for amounts incurred as a result of COVID-19 by $25.8 million for Eversource (increase of $16.3 million for CL&P and $12.5 million at our natural gas businesses, and decrease of $1.8 million at NSTAR Electric). In the third quarter of 2021, the COVID-19 related allowance for uncollectible accounts decreased by $6.5 million at Eversource (increased $4.0 million at CL&P, and decreased $8.3 million at NSTAR Electric and $2.2 million at our natural gas businesses). The COVID-19 related uncollectible amounts were deferred either as incremental regulatory costs at our Connecticut and Massachusetts utilities or deferred through existing regulatory tracking mechanisms that recover uncollectible energy supply costs, as management believes it is probable that these costs will ultimately be recovered from customers in future rates. As of September 30, 2021, the total amount incurred as a result of COVID-19 included in the allowance for uncollectible accounts was $57.0 million at Eversource ($20.1 million at CL&P, $8.5 million at NSTAR Electric, and $27.4 million at our natural gas businesses).

Management concluded that the reserve balance as of September 30, 2021 adequately reflected the collection risk and net realizable value for Eversource’s receivables. Management will continue to evaluate the adequacy of the uncollectible allowance in future reporting periods based on an ongoing assessment of accounts receivable collections, delinquency statistics, and analysis of aging-based quantitative assessments.

The PURA allows CL&P and Yankee Gas to accelerate the recovery of accounts receivable balances attributable to qualified customers under financial or medical duress (uncollectible hardship accounts receivable) outstanding for greater than 180 days and 90 days, respectively. The DPU allows ~~WMECO and~~NSTAR Electric, NSTAR Gas ~~also~~and EGMA to recover in rates amounts associated with certain uncollectible hardship accounts receivable. ~~Certain of NSTAR Electric's~~These uncollectible hardship ~~accounts receivable are expected to be recovered in future rates, similar to WMECO and NSTAR Gas. These uncollectible~~ customer account balances are included in Regulatory Assets or Other Long-Term Assets on the balance sheets.

Hardship customers are protected from shut-off in certain circumstances, and historical collection experience has reflected a higher default risk as compared to the rest of the receivable population. Management uses a higher credit risk profile for this pool of trade receivables as compared to non-hardship receivables. The ~~total provision for uncollectible accounts and~~allowance for uncollectible hardship accounts ~~which~~ is included in the total ~~provision,~~uncollectible allowance balance.

The total allowance for uncollectible accounts is included in Receivables, Net on the balance ~~sheets, and was~~sheets. The activity in the allowance for uncollectible accounts by portfolio segment as of September 30th is as follows:


	Eversource						CL&P						NSTAR Electric						PSNH
(Millions of Dollars)	Hardship Accounts		Retail (Non-Hardship), Wholesale, and Other Receivables		Total Allowance		Hardship Accounts		Retail (Non-Hardship), Wholesale and Other Receivables		Total Allowance		Hardship Accounts		Retail (Non-Hardship), Wholesale, and Other Receivables		Total Allowance		Total Allowance
Three Months Ended 2021
Beginning Balance	$	210.7	$	215.1	$	425.8	$	145.6	$	43.2	$	188.8	$	35.9	$	62.1	$	98.0	$	17.2
Uncollectible Expense	—		12.0		12.0		—		3.6		3.6		—		5.1		5.1		1.2
Uncollectible Costs Deferred (1)	22.8		1.7		24.5		4.5		5.7		10.2		11.8		(3.5)		8.3		1.2
Write-Offs	(3.9)		(20.5)		(24.4)		(3.5)		(5.4)		(8.9)		(0.1)		(7.4)		(7.5)		(2.8)
Recoveries Collected	0.3		3.5		3.8		0.2		1.6		1.8		—		1.1		1.1		0.2
Ending Balance	$	229.9	$	211.8	$	441.7	$	146.8	$	48.7	$	195.5	$	47.6	$	57.4	$	105.0	$	17.0

Nine Months Ended 2021
Beginning Balance	$	194.8	$	164.1	$	358.9	$	129.1	$	28.3	$	157.4	$	39.7	$	51.9	$	91.6	$	17.2
Uncollectible Expense	—		39.7		39.7		—		10.2		10.2		—		12.5		12.5		4.4
Uncollectible Costs Deferred (1)	44.8		53.3		98.1		25.7		21.4		47.1		8.3		11.8		20.1		2.0
Write-Offs	(10.6)		(55.2)		(65.8)		(8.7)		(14.8)		(23.5)		(0.4)		(22.6)		(23.0)		(7.3)
Recoveries Collected	0.9		9.9		10.8		0.7		3.6		4.3		—		3.8		3.8		0.7
Ending Balance	$	229.9	$	211.8	$	441.7	$	146.8	$	48.7	$	195.5	$	47.6	$	57.4	$	105.0	$	17.0


	Eversource						CL&P						NSTAR Electric						PSNH
(Millions of Dollars)	Hardship Accounts		Retail (Non-Hardship), Wholesale, and Other Receivables		Total Allowance		Hardship Accounts		Retail (Non-Hardship), Wholesale and Other Receivables		Total Allowance		Hardship Accounts		Retail (Non-Hardship), Wholesale, and Other Receivables		Total Allowance		Total Allowance
Three Months Ended 2020
Beginning Balance	$	175.5	$	94.5	$	270.0	$	116.3	$	20.4	$	136.7	$	34.6	$	34.1	$	68.7	$	11.8
Uncollectible Expense	—		10.5		10.5		—		3.8		3.8		—		4.5		4.5		0.8
Uncollectible Costs Deferred (1)	10.1		20.4		30.5		11.2		4.9		16.1		(1.3)		10.4		9.1		3.2
Write-Offs	(7.3)		(11.8)		(19.1)		(2.6)		(4.6)		(7.2)		(0.2)		(6.3)		(6.5)		(2.0)
Recoveries Collected	0.4		2.7		3.1		0.3		1.1		1.4		—		1.0		1.0		0.2
Ending Balance	$	178.7	$	116.3	$	295.0	$	125.2	$	25.6	$	150.8	$	33.1	$	43.7	$	76.8	$	14.0

Nine Months Ended 2020
Beginning Balance	$	143.3	$	81.5	$	224.8	$	80.1	$	17.2	$	97.3	$	43.9	$	31.5	$	75.4	$	10.5
ASU 2016-13 Implementation Impact on January 1, 2020	21.6		2.2		23.8		21.3		0.9		22.2		(1.6)		0.3		(1.3)		0.3
Uncollectible Expense	—		31.1		31.1		—		10.0		10.0		—		11.3		11.3		2.1
Uncollectible Costs Deferred (1)	24.9		41.5		66.4		32.7		8.3		41.0		(8.4)		17.3		8.9		5.6
Write-Offs	(12.3)		(49.3)		(61.6)		(10.0)		(14.0)		(24.0)		(0.8)		(20.5)		(21.3)		(5.0)
Recoveries Collected	1.2		9.3		10.5		1.1		3.2		4.3		—		3.8		3.8		0.5
Ending Balance	$	178.7	$	116.3	$	295.0	$	125.2	$	25.6	$	150.8	$	33.1	$	43.7	$	76.8	$	14.0

(1) These expected credit losses are deferred as regulatory costs on the balance sheets, as these amounts are ultimately recovered in rates. Amounts include uncollectible costs for hardship accounts and other customer receivables, including uncollectible amounts related to COVID-19 and uncollectible energy supply costs.

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
Eversource $ 196.8
$ 200.6
$ 126.3
$ 119.9
CL&P 77.6
86.4
64.6
67.7
NSTAR Electric 55.7
54.8
32.3
26.2
PSNH 10.6
9.9
—
—
WMECO 17.0
15.5
11.3
9.9

D. Fair Value Measurements

Fair value measurement guidance is applied to derivative contracts that are not elected or designated as "normal purchases" or "normal sales" ~~("normal")~~(normal) and to the marketable securities held in trusts. Fair value measurement guidance is also applied to valuations of the investments used to calculate the funded status of pension and PBOP plans, the nonrecurring fair value measurements of nonfinancial assets such as goodwill, long-lived assets, equity method investments, and AROs, and in the ~~estimated~~valuation of the acquisition of CMA's assets in 2020. The fair value measurement guidance was also applied in estimating the fair value of preferred stock, long-term debt and ~~long-term debt.~~RRBs.

Fair Value Hierarchy: In measuring fair value, Eversource uses observable market data when available in order to minimize the use of unobservable inputs. Inputs used in fair value measurements are categorized into three fair value hierarchy levels for disclosure purposes. The entire fair value measurement is categorized based on the lowest level of input that is significant to the fair value measurement. Eversource evaluates the classification of assets and liabilities measured at fair value on a quarterly ~~basis, and Eversource's policy is to recognize transfers between levels of the fair value hierarchy as of the end of the reporting period.~~basis. The ~~three~~ levels of the fair value hierarchy are described below:

Level 1 - Inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities as of the reporting date. Active markets are those in which transactions for the asset or liability occur in sufficient frequency and volume to provide pricing information on an ongoing basis.

Level 2 - Inputs are quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-derived valuations in which all significant inputs are observable.

Level 3 - Quoted market prices are not available. Fair value is derived from valuation techniques in which one or more significant inputs or assumptions are unobservable. Where possible, valuation techniques incorporate observable market inputs that can be validated to external sources such as industry exchanges, including prices of energy and energy-related products.

Uncategorized - Investments that are measured at net asset value are not categorized within the fair value hierarchy.

Determination of Fair Value: The valuation techniques and inputs used in Eversource's fair value measurements are described in Note 4, "Derivative Instruments," Note 5, "Marketable Securities," and Note 10, "Fair Value of Financial Instruments," to the financial statements.

E. Other Income, Net

~~Items included within~~The components of Other Income, Net on the statements of income ~~primarily consist~~were as follows:


	For the Three Months Ended
	September 30, 2021								September 30, 2020
(Millions of Dollars)	Eversource		CL&P		NSTAR Electric		PSNH		Eversource		CL&P		NSTAR Electric		PSNH
Pension, SERP and PBOP Non-Service Income Components	$	21.7	$	4.2	$	10.1	$	2.5	$	11.0	$	0.9	$	7.2	$	1.8
AFUDC Equity	10.3		1.7		6.2		0.3		10.3		3.5		5.5		0.9
Equity in Earnings of Unconsolidated Affiliates (1)	4.9		—		0.1		—		3.9		—		0.1		—
Investment (Loss)/Income	(0.6)		(0.3)		(0.2)		(0.1)		1.0		1.3		(0.2)		0.2
Interest Income	7.3		1.3		3.9		0.4		1.5		0.2		0.1		1.2
Gain on Sale of Property	—		—		—		—		1.5		—		—		—
Other	0.2		—		0.1		0.1		—		—		0.1		—
Total Other Income, Net	$	43.8	$	6.9	$	20.2	$	3.2	$	29.2	$	5.9	$	12.8	$	4.1

	For the Nine Months Ended
	September 30, 2021								September 30, 2020
(Millions of Dollars)	Eversource		CL&P		NSTAR Electric		PSNH		Eversource		CL&P		NSTAR Electric		PSNH
Pension, SERP and PBOP Non-Service Income Components	$	63.9	$	11.2	$	30.3	$	7.9	$	34.3	$	3.0	$	22.2	$	5.2
AFUDC Equity	28.7		5.1		18.6		1.2		31.8		11.4		15.8		3.5
Equity in Earnings of Unconsolidated Affiliates (1)	13.3		—		0.3		—		13.8		—		0.4		—
Investment Income/(Loss)	0.7		1.2		0.6		0.3		(1.5)		—		(1.5)		0.1
Interest Income	17.2		4.1		8.8		2.0		3.3		1.8		0.7		2.0
Gain on Sale of Property	0.1		—		—		0.1		1.8		—		0.3		—
Other	0.7		0.1		0.3		0.1		0.1		0.1		0.3		0.1
Total Other Income, Net	$	124.6	$	21.7	$	58.9	$	11.6	$	83.6	$	16.3	$	38.2	$	10.9

(1) Equity in earnings of ~~income/(loss) related to equity method investments,~~unconsolidated affiliates includes $2.1 million of pre-tax unrealized gains associated with an investment ~~income/(loss), interest income and AFUDC related to equity funds. For~~in a renewable energy fund for the ~~three and~~ nine months ended September 30, ~~2017, Eversource had equity in earnings of $5.1 million and $23.0 million, respectively, related to its equity method investments.~~2021. For the ~~three and~~ nine months ended September 30, ~~2016 Eversource had~~2020, equity in earnings of ~~$0.9~~unconsolidated affiliates included $2.4 million ~~and losses~~ of ~~$2.0 million, respectively, related to its equity method investments. Investment income/(loss)~~ primarily ~~relates to debt and equity securities held in trust. For further information, see Note 5, "Marketable Securities," to the financial statements.~~realized gains associated with this investment.

F. Other Taxes

~~Gross~~Eversource's companies that serve customers in Connecticut collect gross receipts taxes levied by the state of Connecticut ~~are collected by CL&P and Yankee Gas~~ from their ~~respective~~ customers. These gross receipts taxes are ~~shown~~recorded separately with collections in Operating Revenues and with payments in Taxes Other Than Income Taxes on the statements of income as follows:


	For the Three Months Ended				For the Nine Months Ended
(Millions of Dollars)	September 30, 2021		September 30, 2020		September 30, 2021		September 30, 2020
Eversource	$	49.4	$	48.4	$	137.9	$	129.1
CL&P	46.1		45.6		120.7		114.2

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 $ 40.3
$ 45.1
$ 118.2
$ 124.8
CL&P 37.8
42.6
103.5
112.2

As agents for state and local governments, Eversource's companies that serve customers in Connecticut and Massachusetts collect certain sales taxes that are recorded on a net basis with no impact on the statements of income.

G. Supplemental Cash Flow Information

Non-cash investing activities include plant additions included in Accounts Payable as follows:


(Millions of Dollars)	As of September 30, 2021		As of September 30, 2020
Eversource	$	359.6	$	357.4
CL&P	75.3		97.8
NSTAR Electric	94.2		92.6
PSNH	32.8		50.0

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

The following table reconciles cash as reported on the balance sheets to the cash and restricted cash balance as reported on the statements of cash flows:


	As of September 30, 2021								As of December 31, 2020
(Millions of Dollars)	Eversource		CL&P		NSTAR Electric		PSNH		Eversource		CL&P		NSTAR Electric		PSNH
Cash as reported on the Balance Sheets	$	88.2	$	62.8	$	3.5	$	3.9	$	106.6	$	90.8	$	0.1	$	0.1
Restricted cash included in:
Special Deposits	55.5		8.7		17.2		18.6		73.6		8.7		17.2		36.8
Marketable Securities	29.7		0.3		0.1		0.5		41.2		0.3		0.1		0.6
Other Long-Term Assets	44.7		—		—		3.2		43.6		—		—		2.1
Cash and Restricted Cash as reported on the Statements of Cash Flows	$	218.1	$	71.8	$	20.8	$	26.2	$	265.0	$	99.8	$	17.4	$	39.6

Special Deposits represent cash collections related to the PSNH RRB customer charges that are held in trust, required ISO-NE cash deposits, and CYAPC and YAEC cash balances. Special Deposits are included in Current Assets on the balance sheets. Restricted cash included in Marketable Securities represents money market funds held in trusts to fund certain non-qualified executive benefits and restricted trusts to fund CYAPC and YAEC's spent nuclear fuel storage obligations. Restricted cash included in Other Long-Term Assets includes $41.5 million related to an Energy Relief Fund for energy efficiency and clean energy measures in the Merrimack Valley, and an additional energy efficiency program established under the terms of the EGMA settlement agreement.

2. REGULATORY ACCOUNTING

Eversource's ~~Regulated~~utility companies are subject to rate regulation that is based on cost recovery and meets the criteria for application of accounting guidance for rate-regulated operations, which considers the effect of regulation on the timing of the recognition of certain revenues and expenses. The ~~Regulated~~regulated companies' financial statements reflect the effects of the rate-making process. The rates charged to the customers of Eversource's ~~Regulated~~regulated companies are designed to collect each company's costs to provide service, ~~including~~plus a return on investment.

The application of accounting guidance for rate-regulated enterprises results in recording regulatory assets and liabilities. Regulatory assets represent the deferral of incurred costs that are probable of future recovery in customer rates. Regulatory assets are amortized as the incurred costs are recovered through customer rates. Regulatory liabilities represent either revenues received from customers to fund expected costs that have not yet been incurred or probable future refunds to customers.

Management believes it is probable that each of the ~~Regulated~~regulated companies will recover its respective investments in long-lived assets ~~including~~and the regulatory ~~assets.~~assets that have been recorded. If management were to determine that it could no longer apply the accounting guidance applicable to rate-regulated enterprises, ~~to any of the Regulated companies' operations,~~ or if management could not conclude it is probable that costs would be recovered from customers in future rates, the applicable costs would be charged to net income in the period in which the determination is made.

Regulatory Assets: The components of regulatory assets were as follows:


	As of September 30, 2021								As of December 31, 2020
(Millions of Dollars)	Eversource		CL&P		NSTAR Electric		PSNH		Eversource		CL&P		NSTAR Electric		PSNH
Benefit Costs	$	2,566.1	$	540.2	$	638.4	$	249.7	$	2,794.2	$	632.3	$	690.0	$	267.6
Income Taxes, Net	756.4		458.1		113.8		18.7		747.1		458.9		110.4		15.2
Securitized Stranded Costs	489.7		—		—		489.7		522.1		—		—		522.1
Storm Restoration Costs, Net	944.2		674.2		198.1		71.9		765.6		515.1		186.4		64.1
Regulatory Tracker Mechanisms	883.0		304.6		320.0		76.8		850.5		246.6		332.2		95.3
Derivative Liabilities	265.3		265.3		—		—		296.3		293.1		—		—
Goodwill-related	302.0		—		259.3		—		314.7		—		270.2		—
Asset Retirement Obligations	121.6		33.7		57.8		4.0		118.4		32.1		58.6		3.9
Other Regulatory Assets	146.9		31.0		48.7		16.9		161.0		33.7		56.1		20.9
Total Regulatory Assets	6,475.2		2,307.1		1,636.1		927.7		6,569.9		2,211.8		1,703.9		989.1
Less: Current Portion	1,016.3		325.3		388.4		97.9		1,076.6		345.6		399.9		115.9
Total Long-Term Regulatory Assets	$	5,458.9	$	1,981.8	$	1,247.7	$	829.8	$	5,493.3	$	1,866.2	$	1,304.0	$	873.2

Eversource As of September 30, 2017 As of December 31, 2016
(Millions of Dollars)
Benefit Costs $ 1,793.8
$ 1,817.8
Derivative Liabilities 385.1
423.3
Income Taxes, Net 652.7
644.5
Storm Restoration Costs 330.1
385.3
Goodwill-related 449.0
464.4
Regulatory Tracker Mechanisms 470.7
576.6
Asset Retirement Obligations 104.8
99.3
Other Regulatory Assets 65.8
115.1
Total Regulatory Assets 4,252.0
4,526.3
Less: Current Portion 746.1
887.6
Total Long-Term Regulatory Assets $ 3,505.9
$ 3,638.7

CL&P Deferred Storm Costs: In 2021 and 2020, multiple tropical and severe storms caused extensive damage to CL&P’s electric distribution systems and customer outages, along with significant pre-staging costs. These storms resulted in deferred pre-staging and storm restoration costs of $195 million for 2021 storms and $344 million for 2020 storms, including the catastrophic impact of Tropical Storm Isaias in August 2020, among others. Management believes all these storm costs were prudently incurred and meet the criteria for specific cost recovery.

As of September 30, 2017 As of December 31, 2016
(Millions of Dollars) CL&P
NSTAR
Electric
PSNH WMECO CL&P
NSTAR
Electric
PSNH WMECO
Benefit Costs $ 415.8
$ 436.7
$ 183.2
$ 84.8
$ 429.3
$ 438.6
$ 184.2
$ 86.7
Derivative Liabilities 381.6
2.4
—
—
420.5
2.8
—
—
Income Taxes, Net 441.1
92.4
22.3
30.5
437.0
89.7
24.2
30.8
Storm Restoration Costs 195.7
112.4
9.2
12.8
239.8
112.5
17.1
15.9
Goodwill-related —
385.5
—
—
—
398.7
—
—
Regulatory Tracker Mechanisms 87.9
201.1
108.0
44.4
123.9
257.3
104.5
46.7
Asset Retirement Obligations 35.1
33.9
16.8
4.5
33.2
31.9
16.2
4.2
Other Regulatory Assets 30.0
15.5
17.6
5.4
43.4
15.6
16.5
7.1
Total Regulatory Assets 1,587.2

1,279.9

357.1

182.4

1,727.1

1,347.1

362.7

191.4
Less: Current Portion 275.0
230.6
112.5
60.6
335.5
289.4
117.2
64.1
Total Long-Term Regulatory Assets $ 1,312.2

$ 1,049.3

$ 244.6

$ 121.8

$ 1,391.6

$ 1,057.7

$ 245.5

$ 127.3

Regulatory Costs in ~~Other~~ Long-Term Assets: Eversource's ~~Regulated~~regulated companies had ~~$108.7~~$260.6 million (including ~~$3.9~~$111.2 million for CL&P, ~~$42.3~~$85.1 million for NSTAR Electric ~~$18.5~~and $3.2 million for ~~PSNH,~~PSNH) and ~~$25.7 million for WMECO) and $86.3~~$196.9 million (including ~~$5.9~~$84.1 million for CL&P, ~~$35.0~~$69.8 million for NSTAR Electric ~~$8.2~~and $4.3 million for ~~PSNH, and $20.1 million for WMECO)~~PSNH) of additional regulatory costs as of September 30, ~~2017~~2021 and December 31, ~~2016,~~2020, respectively, that were included in ~~Other Long-Term Assets~~long-term assets on the balance sheets. These amounts represent incurred costs for which recovery has not yet been specifically approved by the applicable regulatory agency. However, based on regulatory policies or past precedent on similar costs, management believes it is probable that these costs will ultimately be approved and recovered from customers in rates.

As of September 30, 2021 and December 31, 2020, these regulatory costs included net incremental COVID-19 related costs deferred of $41.3 million and $24.0 million at Eversource, respectively, of which, $34.5 million and $15.8 million, respectively, related to non-tracked uncollectible expense and the remainder related to facilities and fleet cleaning, sanitizing costs and supplies for personal protective equipment. Net incremental COVID-19 related costs deferred at CL&P and NSTAR Electric totaled $15.9 million and $10.9 million, respectively, as of September 30, 2021, and $4.7 million and $11.9 million, respectively, as of December 31, 2020, and primarily related to deferred non-tracked uncollectible expense.

Regulatory Liabilities: The components of regulatory liabilities were as follows:


	As of September 30, 2021								As of December 31, 2020
(Millions of Dollars)	Eversource		CL&P		NSTAR Electric		PSNH		Eversource		CL&P		NSTAR Electric		PSNH
EDIT due to Tax Cuts and Jobs Act of 2017	$	2,737.1	$	1,001.5	$	1,025.6	$	363.9	$	2,778.6	$	1,010.7	$	1,044.0	$	371.5
Cost of Removal	676.7		117.0		384.1		19.0		624.8		98.4		363.6		12.9
Benefit Costs	65.9		—		56.5		—		83.6		—		72.5		—
Regulatory Tracker Mechanisms	484.5		208.9		180.6		87.5		366.5		148.9		139.7		47.8
AFUDC - Transmission	79.6		43.6		36.0		—		76.8		44.6		32.2		—
CL&P Settlement Agreement and Storm Performance Penalty	103.4		103.4		—		—		—		—		—		—
Other Regulatory Liabilities	373.3		50.4		84.6		15.8		309.9		39.5		63.2		9.8
Total Regulatory Liabilities	4,520.5		1,524.8		1,767.4		486.2		4,240.2		1,342.1		1,715.2		442.0
Less: Current Portion	612.9		311.3		205.8		96.8		389.4		137.2		164.8		58.8
Total Long-Term Regulatory Liabilities	$	3,907.6	$	1,213.5	$	1,561.6	$	389.4	$	3,850.8	$	1,204.9	$	1,550.4	$	383.2

Eversource As of September 30, 2017 As of December 31, 2016
(Millions of Dollars)
Cost of Removal $ 470.3
$ 459.7
Benefit Costs 125.5
136.2
Regulatory Tracker Mechanisms 175.8
145.3
AFUDC - Transmission 65.4
65.8
Other Regulatory Liabilities 33.4
42.1
Total Regulatory Liabilities 870.4
849.1
Less: Current Portion 170.2
146.8
Total Long-Term Regulatory Liabilities $ 700.2
$ 702.3
Recent Regulatory Developments:

As of September 30, 2017 As of December 31, 2016
(Millions of Dollars) CL&P
NSTAR
Electric
PSNH WMECO CL&P
NSTAR
Electric
PSNH WMECO
Cost of Removal $ 40.5
$ 278.8
$ 40.5
$ 11.7
$ 38.8
$ 271.6
$ 44.1
$ 8.6
Benefit Costs —
106.0
—
—
—
113.1
—
—
Regulatory Tracker Mechanisms 57.1
65.5
5.6
12.7
37.2
63.7
10.7
14.7
AFUDC - Transmission 49.2
7.7
—
8.5
50.2
6.9
—
8.7
Other Regulatory Liabilities 21.3
0.4
2.6
—
21.0
0.2
2.7
0.1
Total Regulatory Liabilities 168.1

458.4

48.7

32.9

147.2

455.5

57.5

32.1
Less: Current Portion 69.3
65.5
7.9
10.2
47.1
63.7
12.7
14.9
Total Long-Term Regulatory Liabilities $ 98.8

$ 392.9

$ 40.8

$ 22.7

$ 100.1

$ 391.8

$ 44.8

$ 17.2

CL&P Tropical Storm Isaias Costs: On August 4, 2020, Tropical Storm Isaias caused catastrophic damage to our electric distribution system, which resulted in significant numbers and durations of customer outages, primarily in Connecticut. In terms of customer outages, this storm was one of the worst in CL&P’s history. PURA will investigate the prudence of costs incurred by CL&P to restore service in response to Tropical Storm Isaias. That investigation is expected to occur either in a separate proceeding not yet initiated or as part of CL&P’s next rate review proceeding. Tropical Storm Isaias resulted in deferred storm restoration costs of approximately $234 million at CL&P and $251 million at Eversource as of September 30, 2021. The estimated cost of restoration may continue to change as additional cost information becomes available and final post-storm costs are deferred or capitalized. Although PURA found that CL&P’s performance in its preparation for and response to Tropical Storm Isaias fell below applicable performance standards in certain instances, CL&P believes it will be able to present credible evidence in a future proceeding demonstrating there is no reasonably close causal connection between the alleged sub-standard performance and the storm costs incurred. While it is possible that some amount of storm costs may be disallowed by PURA in a future proceeding, any such amount cannot be estimated at this time. Eversource and CL&P continue to believe that these storm restoration costs associated with Tropical Storm Isaias were prudently incurred and meet the criteria for cost recovery; and as a result, management does not expect the storm cost review by PURA to have a material impact on the financial position or results of operations of Eversource or CL&P.

CL&P Tropical Storm Isaias Response Investigation: On April 28, 2021, PURA issued a final decision on CL&P’s compliance with its emergency response plan that concluded CL&P failed to comply with certain storm performance standards and was imprudent in certain instances. The $28.4 million performance penalty assessed by PURA was recorded within current regulatory liabilities on CL&P’s balance sheet. See Note 9G, “Commitments and Contingencies - CL&P Regulatory Matters,” for further information.

3. PROPERTY, PLANT AND EQUIPMENT AND ACCUMULATED DEPRECIATION

The following tables summarize property, plant and equipment by asset category:


Eversource	As of September 30, 2021		As of December 31, 2020
(Millions of Dollars)
Distribution - Electric	$	17,257.3	$	16,703.2
Distribution - Natural Gas	6,334.9		6,111.2
Transmission - Electric	12,396.2		11,954.0
Distribution - Water	1,771.1		1,743.1
Solar	200.4		201.5
Utility	37,959.9		36,713.0
Other (1)	1,430.5		1,269.0
Property, Plant and Equipment, Gross	39,390.4		37,982.0
Less: Accumulated Depreciation
Utility	(8,830.2)		(8,476.3)
Other	(550.0)		(477.6)
Total Accumulated Depreciation	(9,380.2)		(8,953.9)
Property, Plant and Equipment, Net	30,010.2		29,028.1
Construction Work in Progress	2,456.9		1,854.4
Total Property, Plant and Equipment, Net	$	32,467.1	$	30,882.5

Eversource As of September 30, 2017 As of December 31, 2016
(Millions of Dollars)
Distribution - Electric $ 14,217.3
$ 13,716.9
Distribution - Natural Gas 3,158.1
3,010.4
Transmission - Electric 8,918.2
8,517.4
Generation 1,215.8
1,224.2
Electric and Natural Gas Utility 27,509.4
26,468.9
Other ⁽¹⁾
679.9
591.6
Property, Plant and Equipment, Gross 28,189.3
27,060.5
Less: Accumulated Depreciation
Electric and Natural Gas Utility (6,838.5 ) (6,480.4 )
Other (274.4 ) (242.0 )
Total Accumulated Depreciation (7,112.9 ) (6,722.4 )
Property, Plant and Equipment, Net 21,076.4
20,338.1
Construction Work in Progress ⁽²⁾
1,460.9
1,012.4
Total Property, Plant and Equipment, Net $ 22,537.3
$ 21,350.5


	As of September 30, 2021						As of December 31, 2020
(Millions of Dollars)	CL&P		NSTAR Electric		PSNH		CL&P		NSTAR Electric		PSNH
Distribution - Electric	$	7,028.9	$	7,798.8	$	2,469.9	$	6,820.7	$	7,544.4	$	2,378.4
Transmission - Electric	5,707.9		4,884.0		1,805.9		5,512.0		4,701.3		1,742.4
Solar	—		200.4		—		—		201.5		—
Property, Plant and Equipment, Gross	12,736.8		12,883.2		4,275.8		12,332.7		12,447.2		4,120.8
Less: Accumulated Depreciation	(2,574.6)		(3,220.7)		(895.4)		(2,475.4)		(3,074.1)		(848.9)
Property, Plant and Equipment, Net	10,162.2		9,662.5		3,380.4		9,857.3		9,373.1		3,271.9
Construction Work in Progress	436.6		949.2		148.7		377.3		750.0		102.4
Total Property, Plant and Equipment, Net	$	10,598.8	$	10,611.7	$	3,529.1	$	10,234.6	$	10,123.1	$	3,374.3

⁽¹⁾ These assets are primarily comprised of ~~building improvements,~~ computer software, hardware and equipment at Eversource ~~Service.~~Service and buildings at The Rocky River Realty Company.

⁽²⁾ ~~As of September 30, 2017, the total CWIP related to NPT was approximately $201 million.~~

As of September 30, 2017 As of December 31, 2016
(Millions of Dollars) CL&P
NSTAR
Electric
PSNH WMECO CL&P NSTAR Electric PSNH WMECO
Distribution $ 5,797.6
$ 5,543.1
$ 2,048.8
$ 868.1
$ 5,562.9
$ 5,402.3
$ 1,949.8
$ 841.9
Transmission 4,061.2
2,545.0
1,115.7
1,147.9
3,912.9
2,435.8
1,059.3
1,061.1
Generation —
—
1,179.8
36.0
—
—
1,188.2
36.0
Property, Plant and Equipment, Gross 9,858.8
8,088.1
4,344.3
2,052.0
9,475.8
7,838.1
4,197.3
1,939.0
Less: Accumulated Depreciation (2,207.0 ) (2,143.8 ) (1,315.7 ) (356.5 ) (2,082.4 ) (2,025.4 ) (1,254.7 ) (338.8 )
Property, Plant and Equipment, Net 7,651.8
5,944.3
3,028.6
1,695.5
7,393.4
5,812.7
2,942.6
1,600.2
Construction Work in Progress 456.2
324.4
139.3
74.1
239.0
239.1
96.7
78.1
Total Property, Plant and Equipment, Net $ 8,108.0
$ 6,268.7
$ 3,167.9
$ 1,769.6
$ 7,632.4
$ 6,051.8
$ 3,039.3
$ 1,678.3

4. DERIVATIVE INSTRUMENTS

The ~~Regulated~~electric and natural gas companies purchase and procure energy and energy-related products, which are subject to price volatility, for their customers. The costs associated with supplying energy to customers are recoverable from customers in future rates. ~~The Regulated~~These regulated companies manage the risks associated with the price volatility of energy and energy-related products through the use of derivative and non-derivative contracts.

Many of the derivative contracts meet the definition of, and are designated as, normal and qualify for accrual accounting under the applicable accounting guidance. The costs and benefits of derivative contracts that meet the definition of normal are recognized in Operating Expenses ~~or Operating Revenues~~ on the statements of income, as applicable, as electricity or natural gas is delivered.

Derivative contracts that are not designated as normal are recorded at fair value as current or long-term Derivative Assets or Derivative Liabilities on the balance sheets. For the ~~Regulated~~electric and natural gas companies, regulatory assets or regulatory liabilities are recorded to offset the fair values of derivatives, as contract settlement amounts are recovered from, or refunded to, customers in their respective energy supply rates.

The gross fair values of derivative assets and liabilities with the same counterparty are offset and reported as net Derivative Assets or Derivative Liabilities, with current and long-term portions, on the balance sheets. The following table presents the gross fair values of contracts, categorized by risk type, and the net amounts recorded as current or long-term derivative assets or liabilities:


		As of September 30, 2021						As of December 31, 2020
(Millions of Dollars)	Fair Value Hierarchy	Commodity Supply and Price Risk Management		Netting (1)		Net Amount Recorded as a Derivative		Commodity Supply and Price Risk Management		Netting (1)		Net Amount Recorded as a Derivative
Current Derivative Assets:
CL&P	Level 3	$	14.4	$	(0.4)	$	14.0	$	13.7	$	(0.4)	$	13.3
Long-Term Derivative Assets:
CL&P	Level 3	51.1		(1.6)		49.5		58.7		(1.8)		56.9
Current Derivative Liabilities:
CL&P	Level 3	(72.2)		—		(72.2)		(68.8)		—		(68.8)
Other	Level 2	—		—		—		(3.3)		0.1		(3.2)
Long-Term Derivative Liabilities:
CL&P	Level 3	(256.6)		—		(256.6)		(294.5)		—		(294.5)

As of September 30, 2017 As of December 31, 2016
(Millions of Dollars)
Commodity Supply and Price Risk
Management

Netting ⁽¹⁾

Net Amount
Recorded as a Derivative
Commodity Supply and Price Risk
Management
Netting ⁽¹⁾

Net Amount
Recorded as
a Derivative
Current Derivative Assets:
Level 2:
Eversource $ —
$ —
$ —
$ 6.0
$ —
$ 6.0
Level 3:
CL&P 10.4
(7.7 ) 2.7
13.9
(9.4 ) 4.5
Long-Term Derivative Assets:
Level 2:
Eversource $ —
$ —
$ —
$ 0.3
$ (0.1 ) $ 0.2
Level 3:
CL&P 74.3
(6.9 ) 67.4
77.3
(11.7 ) 65.6
Current Derivative Liabilities:
Level 2:
Eversource $ (1.5 ) $ 0.4
$ (1.1 ) $ —
$ —
$ —
Level 3:
Eversource (62.2 ) —
(62.2 ) (79.7 ) —
(79.7 )
CL&P (59.9 ) —
(59.9 ) (77.8 ) —
(77.8 )
NSTAR Electric (2.3 ) —
(2.3 ) (1.9 ) —
(1.9 )
Long-Term Derivative Liabilities:
Level 3:
Eversource $ (391.9 ) $ —
$ (391.9 ) $ (413.7 ) $ —
$ (413.7 )
CL&P (391.8 ) —
(391.8 ) (412.8 ) —
(412.8 )
NSTAR Electric (0.1 ) —
(0.1 ) (0.9 ) —
(0.9 )


⁽¹⁾	(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.~~

~~For further information~~ on the ~~fair value~~balance sheets. These amounts are subject to master netting agreements or similar agreements for which the right of ~~derivative contracts, see Note 1D, "Summary of Significant Accounting Policies - Fair Value Measurements," to the financial statements.~~offset exists.

Derivative Contracts at Fair Value with Offsetting Regulatory Amounts

Commodity Supply and Price Risk Management: As required by regulation, CL&P, along with UI, has capacity-related contracts with generation facilities. CL&P has a sharing agreement with UI, with 80 percent of the costs or benefits of each contract borne by or allocated to CL&P and 20 percent borne by or allocated to UI. The combined ~~capacity~~capacities of these contracts ~~is 787~~as of both September 30, 2021 and December 31, 2020 were675 MW. The capacity contracts extend through 2026 and obligate both CL&P and UI to make or receive payments on a monthly basis to or from the generation facilities based on the difference between a set capacity price and the capacity market price received in the ISO-NE capacity markets. ~~In addition, CL&P has a contract to purchase 0.1 million MWh of energy per year through 2020.~~

~~NSTAR Electric has a renewable energy contract to purchase 0.1 million MWh of energy per year through 2018 and a capacity-related contract to purchase up to 35 MW per year through 2019.~~

As of ~~September 30, 2017 and~~ December 31, ~~2016,~~2020, Eversource had New York Mercantile Exchange ~~("NYMEX")~~(NYMEX) financial contracts for natural gas futures in order to reduce variability associated with the ~~purchase~~ price of ~~approximately 10.4 million and 9.2~~8.9 million MMBtu of natural ~~gas, respectively.~~gas. These contracts were classified as Level 2 in the fair value hierarchy. NSTAR Gas terminated its financial contracts swap program in April 2021.

For the three months ended September 30, ~~2017~~2021 and ~~2016,~~2020, there were gains of ~~$0.6~~$0.7 million and losses of ~~$53.4~~$2.6 million, respectively, deferred as regulatory costs, which reflect the change in fair value associated with Eversource's derivative contracts. For the nine months ended September 30, ~~2017~~2021 and ~~2016, these~~2020, there were losses ~~were $30.3~~of $9.5 million and ~~$127.8~~$20.6 million, respectively.

Fair Value Measurements of Derivative Instruments

Derivative contracts classified as Level 2 in the fair value hierarchy relate to the financial contracts for natural gas futures. Prices are obtained from broker quotes and are based on actual market activity. The contracts are valued using NYMEX natural gas prices. Valuations of these contracts also incorporate discount rates using the yield curve approach.

The fair value of derivative contracts classified as Level 3 utilizes significant unobservable inputs. The fair value is modeled using income techniques, such as discounted cash flow valuations adjusted for assumptions ~~relating~~related to exit price. Significant observable inputs for valuations of these contracts include energy and energy-related product prices in future years for which quoted prices in an active market exist. Fair value measurements categorized in Level 3 of the fair value hierarchy are prepared by individuals with expertise in valuation techniques, pricing of energy and energy-related products, and accounting requirements. The future ~~power and~~ capacity prices for periods that are not quoted in an active market or established at auction are based on available market data and are escalated based on estimates of inflation in order to address the full term of the contract.

Valuations of derivative contracts using a discounted cash flow methodology include assumptions regarding the timing and likelihood of scheduled payments and also reflect non-performance risk, including credit, using the default probability approach based on the counterparty's credit rating for assets and the Company's credit rating for liabilities. Valuations incorporate estimates of premiums or discounts that would be required by a market participant to arrive at an exit price, using historical market transactions adjusted for the terms of the contract.

The following is a summary of ~~Eversource's, including CL&P's and NSTAR Electric's,~~ Level 3 derivative contracts and the range of the significant unobservable inputs utilized in the valuations over the duration of the contracts:


	As of September 30, 2021								As of December 31, 2020
CL&P	Range				Weighted Average (1)			Period Covered	Range				Weighted Average (1)			Period Covered
Capacity Prices	$2.61				$	2.61	per kW-Month	2025 - 2026	$	4.30	—	$5.30	$	4.63	per kW-Month	2024 - 2026
Forward Reserve Prices	$	0.50	—	$1.15	$	0.82	per kW-Month	2022 - 2024	$	0.54	—	$0.90	$	0.72	per kW-Month	2021 - 2024

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

(1) Unobservable inputs were weighted by the relative future capacity and forward reserve prices and contractual MWs over the periods covered.

Exit price premiums of 15.5 percent through 189.8 percent, or a weighted average of 8.7 percent, are also applied onto these contracts and reflect the uncertainty and illiquidity premiums that would be required based on the most recent market activity available for similar type contracts. The risk premium was weighted by the relative fair value of the net derivative instruments.

Significant increases or decreases in future ~~energy~~capacity or ~~capacity~~forward reserve prices in isolation would decrease or increase, respectively, the fair value of the derivative liability. Any increases in risk premiums would increase the fair value of the derivative liability. Changes in these fair values are recorded as a regulatory asset or liability and do not impact net income.

~~Valuations using significant unobservable inputs:~~The following table presents changes in the Level 3 category of derivative assets and derivative liabilities measured at fair value on a recurring basis. The derivative assets and liabilities are presented on a net basis.


CL&P	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
(Millions of Dollars)	2021		2020		2021		2020
Derivatives, Net:
Fair Value as of Beginning of Period	$	(279.7)	$	(322.0)	$	(293.1)	$	(329.2)
Net Realized/Unrealized Gains/(Losses) Included in Regulatory Assets	0.7		(4.7)		(10.9)		(22.3)
Settlements	13.7		14.9		38.7		39.7
Fair Value as of End of Period	$	(265.3)	$	(311.8)	$	(265.3)	$	(311.8)

For the Three 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 $ (397.1 ) $ (394.8 ) $ (2.3 ) $ (412.6 ) $ (411.3 ) $ (1.3 )
Net Realized/Unrealized Gains/Losses Included in Regulatory Assets and Liabilities 0.5
(0.7 ) 1.2
(52.3 ) (49.8 ) (2.5 )
Settlements 12.6
13.9
(1.3 ) 21.2
20.1
1.1
Fair Value as of End of Period $ (384.0 ) $ (381.6 ) $ (2.4 ) $ (443.7 ) $ (441.0 ) $ (2.7 )

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 )

5. MARKETABLE SECURITIES

Eversource ~~maintains trusts that hold~~holds marketable securities that are primarily used to fund certain non-qualified executive benefits. ~~These~~The trusts that hold marketable securities are not subject to regulatory oversight by state or federal agencies. CYAPC and YAEC maintain legally restricted trusts, each of which holds marketable securities, to fund the spent nuclear fuel removal obligations of their nuclear fuel storage facilities.

~~Trading~~Equity Securities: ~~Eversource has elected to record certain~~ Unrealized gains and losses on equity securities ~~as trading securities, with the changes~~held in ~~fair values~~Eversource's non-qualified executive benefit trust are recorded in Other Income, Net on the statements of income. ~~As of December 31, 2016, these securities were classified as Level 1 in the~~The fair value ~~hierarchy and totaled $9.6 million. These~~of these equity securities ~~were sold during the first quarter of 2017 and were no longer held~~ as of September 30, ~~2017.~~2021 and December 31, 2020 was $39.2 million and $40.9 million, respectively. For the three months ended September 30, 2021 and 2020, there were unrealized losses of $0.5 million and unrealized gains of $1.6 million, respectively, recorded in Other Income, Net related to these equity securities. For the nine months ended September 30, ~~2016, net~~2021 and 2020, there were unrealized gains ~~on these securities~~ of ~~$0.1~~$2.5 million and ~~$0.6~~unrealized losses of $1.0 million, ~~respectively, were recorded in Other Income, Net on the statements of income. Dividend income is recorded in Other Income, Net when dividends are declared.~~ respectively.

~~Available-for-Sale Securities:~~ ~~The following is a summary of available-for-sale securities, which are recorded at fair value and are included in current and long-term Marketable Securities on the balance sheets.~~

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

Eversource's ~~debt and~~ equity securities also include CYAPC's and YAEC's marketable securities held in spent nuclear ~~decommissioning~~fuel trusts, ~~in the amounts~~which had fair values of ~~$489.1~~$214.9 million and ~~$466.7~~$205.1 million as of September 30, ~~2017~~2021 and December 31, ~~2016,~~2020, respectively. Unrealized gains and losses for these spent nuclear ~~decommissioning~~fuel trusts are subject to regulatory accounting treatment and are recorded in Marketable Securities with the corresponding offset to Other Long-Term Liabilities on the balance sheets, with no impact on the statements of income.

Available-for-Sale Debt Securities: The following is a summary of the available-for-sale debt securities, which are recorded at fair value and are included in current and long-term Marketable Securities on the balance sheets.


	As of September 30, 2021								As of December 31, 2020
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	$	217.5	$	8.0	$	(0.2)	$	225.3	$	213.1	$	11.2	$	(0.1)	$	224.2

Eversource's debt securities include CYAPC's and YAEC's marketable securities held in spent nuclear fuel trusts in the amounts of $195.2 million and $192.5 million as of September 30, 2021 and December 31, 2020, respectively.

Unrealized ~~Losses~~gains and ~~Other-than-Temporary Impairment:~~losses on available-for-sale debt securities held in Eversource's non-qualified benefit trust are recorded in Accumulated Other Comprehensive Income, excluding amounts related to credit losses or losses on securities intended to be sold, which are recorded in Other Income, Net. There have been no significant unrealized losses ~~other-than-temporary impairments or~~and no credit losses for the three and nine months ended September 30, ~~2017~~2021 and ~~2016.~~ 2020, and no allowance for credit losses as of September 30, 2021. Factors considered in determining whether a credit loss exists include ~~the duration and severity of the impairment,~~ adverse conditions specifically affecting the issuer, ~~and~~ the payment history, ratings and rating changes of the ~~security.~~security, and the severity of the impairment. For asset-backed debt securities, underlying collateral and expected future cash flows are also evaluated. Debt securities included in Eversource's non-qualified benefit trust portfolio are investment-grade bonds with a lower default risk based on their credit quality.

As of September 30, 2021, the contractual maturities of available-for-sale debt securities were as follows:


Eversource (Millions of Dollars)	Amortized Cost		Fair Value
Less than one year (1)	$	30.9	$	30.9
One to five years	65.5		67.1
Six to ten years	41.8		43.9
Greater than ten years	79.3		83.4
Total Debt Securities	$	217.5	$	225.3

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

Realized Gains and Losses: Realized gains and losses ~~on available-for-sale securities~~ are recorded in Other Income, Net for Eversource's ~~non-qualified~~ benefit trust and are offset in Other Long-Term Liabilities for CYAPC and YAEC. Eversource utilizes the specific identification basis method for the Eversource non-qualified benefit trust, and the average cost basis method for the CYAPC and YAEC spent nuclear ~~decommissioning~~fuel trusts to compute the realized gains and losses on the sale of ~~available-for-sale~~marketable securities.

~~Contractual Maturities: As of September 30, 2017, the contractual maturities of available-for-sale debt securities were as follows:~~

Eversource
(Millions of Dollars)
Amortized Cost Fair Value
Less than one year⁽¹⁾
$ 40.2
$ 40.2
One to five years 56.7
57.6
Six to ten years 52.6
54.1
Greater than ten years 137.0
139.6
Total Debt Securities $ 286.5
$ 291.5


⁽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.

Fair Value Measurements: The following table presents the marketable securities recorded at fair value on a recurring basis by the level in which they are classified within the fair value hierarchy:


Eversource (Millions of Dollars)	As of September 30, 2021		As of December 31, 2020
Level 1:
Mutual Funds and Equities	$	254.1	$	246.0
Money Market Funds	29.7		41.2
Total Level 1	$	283.8	$	287.2
Level 2:
U.S. Government Issued Debt Securities (Agency and Treasury)	$	98.9	$	72.9
Corporate Debt Securities	63.4		63.8
Asset-Backed Debt Securities	13.4		11.9
Municipal Bonds	6.1		24.0
Other Fixed Income Securities	13.8		10.4
Total Level 2	$	195.6	$	183.0
Total Marketable Securities	$	479.4	$	470.2

Eversource
(Millions of Dollars)
As of September 30, 2017 As of December 31, 2016
Level 1:
Mutual Funds and Equities $ 292.2
$ 274.0
Money Market Funds 21.8
54.8
Total Level 1 $ 314.0
$ 328.8
Level 2:
U.S. Government Issued Debt Securities (Agency and Treasury) $ 69.0
$ 63.0
Corporate Debt Securities 56.1
41.1
Asset-Backed Debt Securities 20.4
18.5
Municipal Bonds 113.6
107.5
Other Fixed Income Securities 10.6
10.3
Total Level 2 $ 269.7
$ 240.4
Total Marketable Securities $ 583.7
$ 569.2

U.S. government issued debt securities are valued using market approaches that incorporate transactions for the same or similar bonds and adjustments for yields and maturity dates. Corporate debt securities are valued using a market approach, utilizing recent trades of the same or similar ~~instrument~~instruments and also incorporating yield curves, credit spreads and specific bond terms and conditions. Asset-backed debt securities include collateralized mortgage obligations, commercial mortgage backed securities, and securities collateralized by auto loans, credit card loans or receivables. Asset-backed debt securities are valued using recent trades of similar instruments, prepayment assumptions, yield curves, issuance and maturity dates, and tranche information. Municipal bonds are valued using a market approach that incorporates reported trades and benchmark yields. Other fixed income securities are valued using pricing models, quoted prices of securities with similar characteristics, and discounted cash flows.

6. SHORT-TERM AND LONG-TERM DEBT

Short-Term Debt - Commercial Paper Programs and Credit Agreements: Eversource parent has a ~~$1.45~~$2.00 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, EGMA and Aquarion Water Company of Connecticut are parties to a five-year ~~$1.45~~$2.00 billion revolving credit ~~facility. The revolving credit~~ facility, which terminates on ~~September 4, 2021. The~~October 15, 2026. This revolving credit facility serves to backstop Eversource parent's ~~$1.45~~$2.00 billion commercial paper program. ~~There were no borrowings outstanding on the revolving credit facility as of September 30, 2017 and December 31, 2016.~~

Except as described below, amounts outstanding under the commercial paper programs 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. Intercompany loans from Eversource parent to CL&P, PSNH and WMECO are included in Notes Payable to Eversource Parent and are classified in current liabilities on their respective balance sheets. Intercompany loans from Eversource parent to CL&P, PSNH and WMECO are eliminated in consolidation on Eversource's balance sheets.

As a result of the October 2017 Eversource parent long-term debt issuances, the net proceeds of which were used to repay short-term borrowings outstanding under the Eversource parent commercial paper program, $898.8 million of short-term debt was reclassified to Long-Term Debt as of September 30, 2017.

NSTAR Electric has a ~~$450~~$650 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 also a party to a five-year ~~$450~~$650 million revolving credit ~~facility. The revolving credit~~ facility, which terminates on ~~September 4, 2021.~~October 15, 2026. The revolving credit facility serves to backstop NSTAR Electric's ~~$450~~$650 million commercial paper program.

The amount of borrowings outstanding and available under the commercial paper programs were as follows:


	Borrowings Outstanding as of				Available Borrowing Capacity as of				Weighted-Average Interest Rate as of
	September 30, 2021		December 31, 2020		September 30, 2021		December 31, 2020		September 30, 2021		December 31, 2020
(Millions of Dollars)
Eversource Parent Commercial Paper Program	$	653.0	$	1,054.3	$	1,347.0	$	945.7	0.18	%	0.25	%
NSTAR Electric Commercial Paper Program	138.0		195.0		512.0		455.0		0.10	%	0.16	%

There were no borrowings outstanding on the revolving credit ~~facility~~facilities as of September 30, ~~2017 and~~2021 or December 31, ~~2016.~~2020.

~~Long-Term Debt Issuances:~~ ~~In March 2017, Eversource parent issued~~

CL&P and PSNH have uncommitted line of credit agreements totaling $450 million and $300 million, respectively, which will expire on May 12, 2022. There are no borrowings outstanding on either the CL&P or PSNH uncommitted line of ~~2.75 percent Series K Senior~~credit agreements as of September 30, 2021.

Amounts outstanding under the commercial paper programs are included in Notes ~~due to mature~~Payable and classified in ~~2022. The proceeds, net~~current liabilities on the Eversource and NSTAR Electric balance sheets, as all borrowings are outstanding for no more than 364 days at one time. As a result of ~~issuance costs, were used to repay short-term~~the NSTAR Gas long-term debt issuances in October 2021, $80.0 million of commercial paper borrowings under the Eversource parent commercial paper ~~program.~~program were classified as Long-Term Debt as of September 30, 2021.

~~In March 2017,~~The Company expects the future operating cash flows of Eversource, CL&P, ~~issued $300 million of 3.20 percent 2017 Series A First and Refunding Mortgage Bonds due to mature in 2027. 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~~and PSNH, along with existing borrowing availability and access 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-termboth debt and ~~fund~~equity markets, will be sufficient to meet any working capital ~~expenditures~~ and ~~working capital.~~future operating requirements, and capital investment forecasted opportunities.

~~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,~~Intercompany Borrowings: Eversource parent ~~issued $450 million 2.75 percent Series K Senior Notes due~~uses its available capital resources to ~~mature~~provide loans to its subsidiaries to assist 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,meeting their short-term borrowing needs. Eversource parent ~~issued $450~~records intercompany interest income from its loans to subsidiaries, which is eliminated in consolidation. Intercompany loans from Eversource parent to its subsidiaries are eliminated in consolidation on Eversource's balance sheets. As of September 30, 2021, there were intercompany loans from Eversource parent to PSNH of $66.5 million, ~~of 2.90 percent 2017 Series L Senior Notes due~~and to ~~mature in 2024. The proceeds, net~~a subsidiary of ~~issuance costs, were used to repay short-term borrowings.~~

~~In October 2017,~~ NSTAR Electric ~~issued $350~~of $24.6 million. As of December 31, 2020, there were intercompany loans from Eversource parent to PSNH of $46.3 million, ~~of 3.20 percent Debentures due~~and to ~~mature in 2027. The debentures are part of the same series~~a subsidiary of NSTAR ~~Electric’s existing 3.20 percent Debentures that were initially issued~~Electric of $21.3 million. Intercompany loans from Eversource parent are included in ~~May 2017. The aggregate outstanding principal amount for~~Notes Payable to Eversource Parent and classified in current liabilities on the 3.20 percent Debentures is now $700 million. The proceeds, net of issuance costs, will be used to redeem long-term debt due to mature on November 15, 2017. As the debt issuance refinanced short-term debt, the amount was reclassified to Long-Term Debt on Eversource's and NSTAR Electric'srespective subsidiary's balance sheets.

~~Long-Term Debt Repayments:~~ ~~In March 2017, CL&P repaid at maturity the $150 million 5.375 percent 2007 Series A First and Refunding Mortgage Bonds.~~

~~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.~~

~~In October 2017, NSTAR Gas repaid at maturity $25 million of 7.04 percent Series M First Mortgage Bonds.~~

Availability under Long-Term Debt Issuance Authorizations:~~On January 4, 2017, PURA approved CL&P's request for authorization to issue up to $1.325 billion in long-term debt through December 31, 2020.~~ On March ~~30, 2017,~~31, 2021, the DPU approved NSTAR Electric's request for authorization to issue up to ~~$700~~$1.60 billion in long-term debt through December 31, 2023. On September 10, 2021, the DPU approved EGMA’s request for authorization to issue up to $725 million in long-term debt through December 31, ~~2018.~~2023. The remaining Eversource operating companies, including CL&P and PSNH, have utilized the long-term debt authorizations in place with the respective regulatory commissions.

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

(Millions of Dollars)

Issuance/(Repayment)

Issue Date or Repayment Date

Maturity Date

Use of Proceeds for Issuance/
Repayment Information

CL&P:

2.05% Series A First Mortgage Bonds

425.0

June 2021

July 2031

Repaid short-term debt, paid capital expenditures and working capital

4.38% Series A PCRB

(120.5)

September 2021

September 2028

Paid on par call date in advance of maturity

NSTAR Electric:

3.10% 2021 Debentures

300.0

May 2021

June 2051

Refinanced investments in eligible green

expenditures, which were previously financed in 2019 and 2020

3.50% Series F Senior Notes

(250.0)

June 2021

September 2021

Paid on par call date in advance of maturity date

1.95% 2021 Debentures

300.0

August 2021

August 2031

Repaid short-term debt, paid capital expenditures and working capital

PSNH:

4.05% Series Q First Mortgage Bonds

(122.0)

March 2021

June 2021

Paid on par call date in advance of maturity date

3.20% Series R First Mortgage Bonds

(160.0)

June 2021

September 2021

Paid on par call date in advance of maturity date

2.20% Series V First Mortgage Bonds

350.0

June 2021

June 2031

Repaid short-term debt, including short-term debt used to redeem Series R First Mortgage Bonds, paid capital expenditures and working capital

Other:

Eversource Parent 2.50% Series I Senior Notes

(450.0)

February 2021

March 2021

Paid on par call date in advance of maturity date

Eversource Parent 2.55% Series S Senior Notes

350.0

March 2021

March 2031

Repaid short-term debt, including short-term debt used to redeem Series I Senior Notes

Eversource Parent 1.40% Series U Senior Notes

300.0

August 2021

August 2026

Repaid short-term debt

Eversource Parent Variable Rate Series T Senior Notes (1)

350.0

August 2021

August 2023

Repaid short-term debt

Aquarion Water Company of Connecticut 3.31%

Senior Notes

100.0

April 2021

April 2051

Repaid 5.50% Notes, repaid short-term debt, paid capital expenditures and working capital

Aquarion Water Company of Connecticut 5.50% Notes

(40.0)

April 2021

Paid at maturity

Yankee Gas 1.38% Series S First Mortgage Bonds

90.0

August 2021

August 2026

(2)

Yankee Gas 2.88% Series T First Mortgage Bonds

35.0

August 2021

August 2051

(2)

EGMA 2.11% Series A First Mortgage Bonds

310.0

September 2021

October 2031

(2)

EGMA 2.92% Series B First Mortgage Bonds

240.0

September 2021

October 2051

(2)

NSTAR Gas 2.25% Series T First Mortgage Bonds

40.0

October 2021

November 2031

(2)

NSTAR Gas 3.03% Series U First Mortgage Bonds

40.0

October 2021

November 2051

(2)

(1) On August 10, 2021, Eversource Parent issued $350 million of floating rate Series T Senior Notes with a maturity date of August 15, 2023. The notes have a coupon rate based on the Compounded SOFR plus 0.25%.

(2) The use of proceeds from these various issuances refinanced existing indebtedness, funded capital expenditures and were for general corporate purposes. The EGMA indebtedness that was refinanced included $309.4 million of long-term debt.

7. RATE REDUCTION BONDS AND VARIABLE INTEREST ENTITIES

Rate Reduction Bonds: In May 2018, PSNH Funding, a wholly-owned subsidiary of PSNH, issued $635.7 million of securitized RRBs in multiple tranches with a weighted average interest rate of 3.66 percent, and final maturity dates ranging from 2026 to 2035. The RRBs are expected to be repaid by February 1, 2033. RRB payments consist of principal and interest and are paid semi-annually, beginning on February 1, 2019. The RRBs were issued pursuant to a finance orderissued by the NHPUC in January 2018 to recover remaining costs resulting from the divestiture of PSNH’s generation assets.

PSNH Funding was formed solely to issue RRBs to finance PSNH's unrecovered remaining costs associated with the divestiture of its generation assets. PSNH Funding is considered a VIE primarily because the equity capitalization is insufficient to support its operations. PSNH has the power to direct the significant activities of the VIE and 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 sheets and income statements:


(Millions of Dollars)
PSNH Balance Sheets:	As of September 30, 2021		As of December 31, 2020
Restricted Cash - Current Portion (included in Current Assets)	$	18.3	$	36.8
Restricted Cash - Long-Term Portion (included in Other Long-Term Assets)	3.2		2.1
Securitized Stranded Cost (included in Regulatory Assets)	489.7		522.1
Other Regulatory Liabilities (included in Regulatory Liabilities)	8.0		9.1
Accrued Interest (included in Other Current Liabilities)	3.0		8.0
Rate Reduction Bonds - Current Portion	43.2		43.2
Rate Reduction Bonds - Long-Term Portion	453.7		496.9


(Millions of Dollars) PSNH Income Statements:	For the Three Months Ended				For the Nine Months Ended
	September 30, 2021		September 30, 2020		September 30, 2021		September 30, 2020
Amortization of RRB Principal (included in Amortization of Regulatory Assets, Net)	$	10.8	$	10.8	$	32.4	$	32.4
Interest Expense on RRB Principal (included in Interest Expense)	4.5		4.9		13.9		14.9

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

Eversource ~~Service sponsors a~~provides defined benefit retirement ~~plan ("Pension Plan")~~plans (Pension Plans) that ~~covers~~cover eligible ~~participants.~~employees. In addition to the Pension ~~Plan,~~Plans, Eversource maintains non-qualified defined benefit retirement plans ~~sponsored by Eversource Service ("SERP Plans")~~(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 (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 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~~plan expense/(income) for the Pension, SERP and PBOP Plans, prior to amounts capitalized as Property, Plant and Equipment or deferred as regulatory assets for future recovery, are shown below. The service cost component of net periodic benefit ~~expense and the intercompany allocations,~~plan expense/(income), less the capitalized ~~portions of pension, SERP and PBOP amounts, are~~portion, is included in Operations and Maintenance expense on the statements of income. ~~Capitalized amounts relate to employees working on capital projects and~~The remaining components of net periodic benefit plan expense/(income), less the deferred portion, are included in ~~Property, Plant and Equipment,~~Other Income, Net on the ~~balance sheets.~~statements of income. 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 portion,~~of net periodic benefit plan expense/(income), as these amounts are cash settled on a short-term basis.


	Pension and SERP								PBOP
	For the Three Months Ended September 30, 2021								For the Three Months Ended September 30, 2021
(Millions of Dollars)	Eversource		CL&P		NSTAR Electric		PSNH		Eversource		CL&P		NSTAR Electric		PSNH
Service Cost	$	21.5	$	5.6	$	4.0	$	2.2	$	3.3	$	0.5	$	0.6	$	0.3
Interest Cost	32.5		6.7		6.7		3.7		4.3		0.8		1.1		0.4
Expected Return on Plan Assets	(109.5)		(21.7)		(27.1)		(11.9)		(19.8)		(2.5)		(9.2)		(1.6)
Actuarial Loss	60.7		10.8		15.3		5.3		2.0		0.4		0.5		0.1
Prior Service Cost/(Credit)	0.3		—		0.1		—		(5.3)		0.3		(4.3)		0.1
Total Net Periodic Benefit Plan Expense/(Income)	$	5.5	$	1.4	$	(1.0)	$	(0.7)	$	(15.5)	$	(0.5)	$	(11.3)	$	(0.7)
Intercompany Expense/(Income) Allocations	N/A		$	2.2	$	2.4	$	0.7	N/A		$	(0.4)	$	(0.5)	$	(0.2)

	Pension and SERP								PBOP
	For the Nine Months Ended September 30, 2021								For the Nine Months Ended September 30, 2021
(Millions of Dollars)	Eversource		CL&P		NSTAR Electric		PSNH		Eversource		CL&P		NSTAR Electric		PSNH
Service Cost	$	64.3	$	17.4	$	11.9	$	6.6	$	10.1	$	1.7	$	1.8	$	0.9
Interest Cost	97.5		20.7		20.1		10.9		12.9		2.4		3.3		1.3
Expected Return on Plan Assets	(328.0)		(65.0)		(81.1)		(35.6)		(59.3)		(7.7)		(27.7)		(4.6)
Actuarial Loss	183.1		34.6		46.1		15.4		5.9		1.2		1.6		0.4
Prior Service Cost/(Credit)	1.1		—		0.3		—		(15.9)		0.8		(12.7)		0.3
Total Net Periodic Benefit Plan Expense/(Income)	$	18.0	$	7.7	$	(2.7)	$	(2.7)	$	(46.3)	$	(1.6)	$	(33.7)	$	(1.7)
Intercompany Expense/(Income) Allocations	N/A		$	5.8	$	6.4	$	1.9	N/A		$	(1.3)	$	(1.5)	$	(0.5)


														Pension and SERP								PBOP
	Pension and SERP													For the Three Months Ended September 30, 2020								For the Three Months Ended September 30, 2020
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

	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			(Millions of Dollars)	Eversource		CL&P		NSTAR Electric		PSNH		Eversource		CL&P		NSTAR Electric		PSNH
Service Cost	$	2.4		$	3.0		$	7.1		$	9.2		Service Cost	$	18.7	$	5.4	$	3.8	$	2.0	$	2.4	$	0.4	$	0.5	$	0.2
Interest Cost	6.8			7.5			20.3			26.5			Interest Cost	44.4		9.3		9.7		4.8		6.1		1.1		1.7		0.7
Expected Return on Plan Assets	(16.0		)	(15.9		)	(47.8		)	(47.3		)	Expected Return on Plan Assets	(99.2)		(19.8)		(25.7)		(11.1)		(18.3)		(2.5)		(8.5)		(1.4)
Actuarial Loss	2.2			3.0			6.9			5.0			Actuarial Loss	50.7		9.7		14.0		3.8		2.2		0.3		0.6		0.2
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/(Credit)													Prior Service Cost/(Credit)	0.2		—		—		—		(5.3)		0.3		(4.2)		0.1
Total Net Periodic Benefit Plan Expense/(Income)													Total Net Periodic Benefit Plan Expense/(Income)	$	14.8	$	4.6	$	1.8	$	(0.5)	$	(12.9)	$	(0.4)	$	(9.9)	$	(0.2)
Intercompany Expense/(Income) Allocations													Intercompany Expense/(Income) Allocations	N/A		$	2.4	$	2.3	$	0.8	N/A		$	(0.3)	$	(0.4)	$	(0.1)

														Pension and SERP								PBOP
														For the Nine Months Ended September 30, 2020								For the Nine Months Ended September 30, 2020
(Millions of Dollars)													(Millions of Dollars)	Eversource		CL&P		NSTAR Electric		PSNH		Eversource		CL&P		NSTAR Electric		PSNH
Service Cost													Service Cost	$	57.0	$	16.5	$	11.4	$	6.2	$	7.3	$	1.3	$	1.6	$	0.6
Interest Cost													Interest Cost	133.0		28.1		29.0		14.5		18.3		3.3		5.0		2.1
Expected Return on Plan Assets													Expected Return on Plan Assets	(298.8)		(59.6)		(77.2)		(33.5)		(55.1)		(7.4)		(25.5)		(4.2)
Actuarial Loss													Actuarial Loss	150.7		29.4		41.3		11.8		6.3		0.9		1.8		0.6
Prior Service Cost/(Credit)													Prior Service Cost/(Credit)	0.8		—		0.2		—		(15.9)		0.8		(12.7)		0.3
Total Net Periodic Benefit Plan Expense/(Income)													Total Net Periodic Benefit Plan Expense/(Income)	$	42.7	$	14.4	$	4.7	$	(1.0)	$	(39.1)	$	(1.1)	$	(29.8)	$	(0.6)
Intercompany Expense/(Income) Allocations													Intercompany Expense/(Income) Allocations	N/A		$	6.7	$	6.5	$	2.2	N/A		$	(0.9)	$	(1.0)	$	(0.4)

Eversource Contributions: Eversource currently expects to make contributions of $180 million to the Pension Plans in 2021, of which $99 million and $30 million will be contributed by CL&P and NSTAR Electric, respectively.

Pension and SERP
For the Three Months Ended September 30, 2017 For the Three Months Ended September 30, 2016
(Millions of Dollars) CL&P NSTAR Electric PSNH WMECO CL&P NSTAR Electric PSNH WMECO
Service Cost $ 4.6
$ 3.1
$ 2.4
$ 0.7
$ 4.6
$ 3.3
$ 2.5
$ 0.8
Interest Cost 10.5
8.6
5.3
2.1
10.2
8.5
5.1
2.1
Expected Return on Pension Plan Assets (17.8 ) (17.5 ) (10.0 ) (4.4 ) (18.0 ) (16.9 ) (9.6 ) (4.4 )
Actuarial Loss 6.8
8.9
3.0
1.5
6.3
8.7
2.5
1.3
Prior Service Cost 0.4
0.1
0.1
0.1
0.4
—
0.1
0.1
Total Net Periodic Benefit Expense/(Income) $ 4.5
$ 3.2
$ 0.8
$ —
$ 3.5
$ 3.6
$ 0.6
$ (0.1 )
Intercompany Allocations $ 2.4
$ 1.8
$ 0.8
$ 0.5
$ 3.5
$ 2.2
$ 1.0
$ 0.6
Capitalized Pension Expense $ 2.4
$ 1.9
$ 0.4
$ 0.1
$ 2.2
$ 2.0
$ 0.4
$ 0.1

Pension and SERP
For the Nine Months Ended September 30, 2017 For the Nine Months Ended September 30, 2016
(Millions of Dollars) CL&P
NSTAR
Electric
PSNH WMECO CL&P
NSTAR
Electric
PSNH WMECO
Service Cost $ 13.9
$ 9.4
$ 7.3
$ 2.3
$ 14.3
$ 9.9
$ 7.5
$ 2.4
Interest Cost 31.3
25.6
15.9
6.3
31.2
25.3
15.4
6.3
Expected Return on Pension Plan Assets (53.9 ) (52.5 ) (29.9 ) (13.3 ) (54.2 ) (50.7 ) (28.9 ) (13.1 )
Actuarial Loss 20.7
26.4
8.7
4.5
19.2
25.8
7.5
4.1
Prior Service Cost 1.1
0.2
0.4
0.2
1.1
—
0.3
0.2
Total Net Periodic Benefit Expense/(Income) $ 13.1
$ 9.1
$ 2.4
$ —
$ 11.6
$ 10.3
$ 1.8
$ (0.1 )
Intercompany Allocations $ 7.4
$ 5.5
$ 2.5
$ 1.4
$ 10.3
$ 6.7
$ 3.0
$ 1.9
Capitalized Pension Expense $ 7.3
$ 5.4
$ 1.1
$ 0.3
$ 7.1
$ 5.7
$ 1.0
$ 0.3

PBOP
For the Three Months Ended September 30, 2017 For the Three Months Ended September 30, 2016
(Millions of Dollars) CL&P
NSTAR
Electric
PSNH WMECO CL&P
NSTAR
Electric
PSNH WMECO
Service Cost $ 0.5
$ 0.3
$ 0.3
$ 0.1
$ 0.6
$ 0.6
$ 0.4
$ 0.1
Interest Cost 1.3
1.9
0.8
0.3
1.3
2.5
0.7
0.3
Expected Return on Plan Assets (2.4 ) (6.6 ) (1.4 ) (0.6 ) (2.5 ) (6.4 ) (1.4 ) (0.6 )
Actuarial Loss 0.2
0.9
0.1
—
0.5
1.2
0.2
—
Prior Service Cost/(Credit) 0.3
(4.3 ) 0.2
—
0.2
(2.9 ) 0.1
—
Total Net Periodic Benefit (Income)/Expense $ (0.1 ) $ (7.8 ) $ —
$ (0.2 ) $ 0.1
$ (5.0 ) $ —
$ (0.2 )
Intercompany Allocations $ (0.2 ) $ (0.2 ) $ (0.1 ) $ —
$ —
$ (0.1 ) $ —
$ —
Capitalized PBOP Income $ (0.1 ) $ (4.0 ) $ —
$ (0.1 ) $ —
$ (2.2 ) $ —
$ (0.1 )

PBOP
For the Nine Months Ended September 30, 2017 For the Nine Months Ended September 30, 2016
(Millions of Dollars) CL&P
NSTAR
Electric
PSNH WMECO CL&P NSTAR Electric PSNH WMECO
Service Cost $ 1.5
$ 1.1
$ 1.0
$ 0.3
$ 1.4
$ 2.5
$ 0.9
$ 0.3
Interest Cost 4.0
5.7
2.3
0.8
4.0
10.3
2.2
0.8
Expected Return on Plan Assets (7.3 ) (19.9 ) (4.1 ) (1.7 ) (7.6 ) (19.2 ) (4.2 ) (1.7 )
Actuarial Loss 0.7
2.6
0.4
—
0.9
1.7
0.5
—
Prior Service Cost/(Credit) 0.8
(12.9 ) 0.4
0.1
0.2
(2.9 ) 0.1
—
Total Net Periodic Benefit Income $ (0.3 ) $ (23.4 ) $ —
$ (0.5 ) $ (1.1 ) $ (7.6 ) $ (0.5 ) $ (0.6 )
Intercompany Allocations $ (0.5 ) $ (0.7 ) $ (0.3 ) $ (0.1 ) $ 0.3
$ —
$ —
$ —
Capitalized PBOP Income $ (0.4 ) $ (11.9 ) $ —
$ (0.2 ) $ (0.5 ) $ (3.3 ) $ —
$ (0.3 )

8.9. COMMITMENTS AND CONTINGENCIES

A. Environmental Matters

Eversource, CL&P, NSTAR Electric ~~PSNH~~ and ~~WMECO~~PSNH are subject to environmental laws and regulations intended to mitigate or remove the effect of past operations and improve or maintain the quality of the environment. These laws and regulations require the removal or the remedy of the effect on the environment of the disposal or release of certain specified hazardous substances at current and former operating sites. Eversource, CL&P, NSTAR Electric ~~PSNH~~ and ~~WMECO~~PSNH have an active environmental auditing and training program and each believes it is substantially in compliance with all enacted laws and regulations.

The number of environmental sites and related reserves for which remediation or long-term monitoring, preliminary site work or site assessment is being performed are as follows:


	As of September 30, 2021			As of December 31, 2020
	Number of Sites	Reserve (in millions)		Number of Sites	Reserve (in millions)
Eversource	62	$	111.9	63	$	102.4
CL&P	14	12.5		15	12.3
NSTAR Electric	12	3.7		12	4.7
PSNH	9	6.4		9	7.1

As of September 30, 2017 As of December 31, 2016
Number of Sites
Reserve
(in millions)
Number of Sites
Reserve
(in millions)
Eversource 58
$ 57.7
61
$ 65.8
CL&P 14
4.9
14
4.9
NSTAR Electric 10
2.0
13
3.2
PSNH 11
5.7
11
5.3
WMECO 4
0.8
4
0.6

The increase in the reserve balance was due primarily to a change in cost estimates at an NSTAR Gas MGP site under investigation for which we now know of additional remediation that is required.

Included in the ~~Eversource~~ number of sites and reserve amounts above are former MGP sites that were operated several decades ago and manufactured natural gas from coal and other processes, which resulted in certain by-products remaining in the environment that may pose a potential risk to human health and the environment, for which Eversource may have potential liability. The reserve balances related to these former MGP sites were ~~$51.9~~$102.4 million and ~~$59.0~~$92.2 million as of September 30, ~~2017~~2021 and December 31, ~~2016,~~2020, respectively, and related primarily to the natural gas business segment. The reduction in the reserve balance at the MGP sites in the first quarter of 2017 was primarily due to a change in cost estimates at one site where actual contamination was less than originally estimated.

These reserve estimates are subjective in nature as they take into consideration several different remediation options at each specific site. The reliability and precision of these estimates can be affected by several factors, including new information concerning either the level of contamination at the site, the extent of Eversource's, CL&P's, NSTAR Electric's ~~PSNH's,~~ and ~~WMECO's~~PSNH's responsibility for remediation or the extent of remediation required, recently enacted laws and regulations or changes in cost estimates due to certain economic factors. It is possible that new information or future developments could require a reassessment of the potential exposure to ~~related~~required environmental ~~matters.~~remediation. As this information becomes available, management will continue to assess the potential exposure and adjust the reserves accordingly.

B. Long-Term Contractual Arrangements

The following is an update to the current status of long-term contractual arrangements set forth in Note 13B of the Eversource 2020 Form 10-K.

Renewable Energy: Renewable energy contracts include non-cancelable commitments under contracts of NSTAR Electric for the purchase of energy and RECs from renewable energy facilities.


NSTAR Electric
(Millions of Dollars)	2021		2022		2023		2024		2025		Thereafter		Total
Renewable Energy	$	27.1	$	103.9	$	230.5	$	341.2	$	348.1	$	6,564.2	$	7,615.0

The table has been updated to include long-term commitments of NSTAR Electric pertaining to the Massachusetts Clean Energy 83D contract, for which construction commenced in 2021. Estimated costs under this contract are expected to begin in 2023 and range between $150 million and $415 million per year under a 20-year contract, totaling approximately $6.7 billion.

C. Guarantees and Indemnifications

In the normal course of business, Eversource parent provides credit assurances on behalf of its subsidiaries, including CL&P, NSTAR Electric ~~PSNH~~ and ~~WMECO,~~PSNH, in the form of guarantees.

Eversource parent issued a guaranty on behalf of its subsidiary, NPT, under which, beginning at the time the Northern Pass Transmission line goes into commercial operation, Eversource parent will guarantee the financial obligations of NPT under the TSA with HQ in an amount not to exceed $25 million. Eversource parent's obligations under the guaranty expire upon the full, final and indefeasible payment of the guaranteed obligations. Eversource parent has also entered into a guaranty on behalf of NPT under which Eversource parent will guarantee NPT's obligations under a facility with a financial institution pursuant to which NPT may request letters of credit in an aggregate amount of up to approximately $14 million.

Eversource parent has also guaranteed certain indemnification and other obligations as a result of the sales of former unregulated subsidiaries and the termination of an unregulated business, with maximum exposures either not specified or not material.

Management does not anticipate a material impact to net income or cash flows as a result of these various guarantees and indemnifications.

Guarantees issued on behalf of unconsolidated entities, including equity method offshore wind investments, for which Eversource parent is the guarantor, are recorded at fair value as a liability on the balance sheet at the inception of the guarantee. Eversource regularly reviews performance risk under these guarantee arrangements, and in the event it becomes probable that Eversource parent will be required to perform under the guarantee, the amount of probable payment will be recorded. The fair value of guarantees issued on behalf of unconsolidated entities are recorded within Other Long-Term Liabilities on the balance sheet, and was $5.7 million as of September 30, 2021.

The following table summarizes Eversource parent's exposure to guarantees and indemnifications of its subsidiaries and affiliates to external ~~parties, as~~parties:


As of September 30, 2021
Company (Obligor)	Description	Maximum Exposure (in millions)		Expiration Dates
North East Offshore LLC	Construction-related purchase agreements with third-party contractors (1)	$	1,093.5	(1)
Eversource Investment LLC	Funding and indemnification obligations of North East Offshore LLC (2)	—		(2)
Sunrise Wind LLC	OREC capacity production (3)	2.2		(3)
Sunrise Wind LLC	Construction-related purchase agreements with third-party contractors (4)	386.4		—
South Fork Wind, LLC	Transmission interconnection	1.2		—
South Fork Wind, LLC	Construction-related purchase agreements with third-party contractors (5)	40.6		2023
Bay State Wind LLC	Real estate purchase	2.5		2022
Various	Surety bonds (6)	67.5		2021 - 2023
Rocky River Realty Company and Eversource Service	Lease payments for real estate	4.0		2024

(1) Eversource parent issued guarantees on behalf of ~~September 30, 2017:~~ its 50 percent-owned affiliate, North East Offshore LLC (NEO), under which Eversource parent agreed to guarantee 50 percent of NEO’s performance of obligations under certain purchase agreements with third-party contactors, in an aggregate amount not to exceed $1.3 billion with an expiration date in 2025. Eversource parent also issued a separate guarantee to Ørsted on behalf of NEO, under which Eversource parent agreed to guarantee 50 percent of NEO’s payment obligations under certain offshore wind project construction-related agreements with Ørsted in an aggregate amount not to exceed $62.5 million. Any amounts paid under this guarantee to Ørsted will count toward, but not increase, the maximum amount of the Funding Guarantee described in Note 2, below. The guarantee expires upon the full performance of the guaranteed obligations.

(2) Eversource parent issued a guarantee (Funding Guarantee) on behalf of Eversource Investment LLC (EI), its wholly-owned subsidiary that holds a 50 percent ownership interest in NEO, under which Eversource parent agreed to guarantee certain funding obligations and certain indemnification payments of EI under the Amended and Restated Limited Liability Company Operating Agreement of NEO, in an aggregate amount not to exceed $910 million. The guaranteed obligations include payment of EI's funding obligations during the construction phase of NEO’s underlying offshore wind projects and indemnification obligations associated with third party credit support for its investment in NEO. Eversource parent’s obligations under the Funding Guarantee expire upon the full performance of the guaranteed obligations.

(3) Eversource parent issued a guarantee on behalf of its 50 percent-owned affiliate, Sunrise Wind LLC, whereby Eversource parent will guarantee Sunrise Wind LLC's performance of certain obligations, in an aggregate amount not to exceed $15.4 million, under the Offshore Wind Renewable Energy Certificate Purchase and Sale Agreement (the Agreement). The Agreement was executed on October 23, 2019, by and between the New York State Energy Research and Development Authority (NYSERDA) and Sunrise Wind LLC. The guarantee expires upon the full performance of the guaranteed obligations.

Company 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
Various
Surety Bonds⁽²⁾
40.1
2017 - 2018
Eversource Service and Rocky River Realty Company Lease Payments for Vehicles and Real Estate 8.2
2019 - 2024
(4) Eversource parent issued a guaranty on behalf of its 50 percent-owned affiliate, Sunrise Wind LLC, whereby Eversource parent will guarantee Sunrise Wind LLC's performance of certain obligations, in an aggregate amount not to exceed $420.6 million, in connection with a construction-related purchase agreement. Eversource parent’s obligations under the guarantee expire upon the earlier of (i) April 14, 2026 and (ii) full performance of the guaranteed obligations.

⁽¹⁾

Eversource parent issued a declining balance guaranty on behalf of its subsidiary, Eversource Gas Transmission LLC, to guarantee the payment of the subsidiary's capital contributions for its investment in the Access Northeast project. The guaranty decreases as capital contributions are made. The guaranty will expire upon the earlier of the full performance of the guaranteed obligations or December 31, 2021.


⁽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.

C. (5) Eversource parent issued two guarantees on behalf of its 50 percent-owned affiliate, South Fork Wind, LLC, whereby Eversource parent will guarantee South Fork Wind, LLC's performance of certain obligations in connection with two construction-related purchase agreements. Under one guarantee, Eversource parent will guarantee South Fork Wind, LLC's performance of certain obligations, in an aggregate amount not to exceed $25.8 million. Eversource parent’s obligations under the guarantee expire upon the earlier of (i) October 4, 2023 and (ii) full performance of the guaranteed obligations. Under the second guaranty, Eversource parent will guarantee South Fork Wind, LLC's performance of certain obligations, in an aggregate amount not to exceed $14.8 million. Eversource parent’s obligations under the guarantee expire upon the earlier of (i) October 18, 2023 and (ii) full performance of the guaranteed obligations.

(6) 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.

Letter of Credit: On September 16, 2020, Eversource parent entered into a guarantee on behalf of EI, which holds Eversource's investments in offshore wind-related equity method investments, under which Eversource parent would guarantee EI's obligations under a letter of credit facility with a financial institution that EI may request in an aggregate amount of up to approximately $25 million.

D. Spent Nuclear Fuel Obligations - Yankee Companies

CL&P, NSTAR Electric ~~PSNH~~ and ~~WMECO~~PSNH have plant closure and fuel storage cost obligations to the Yankee Companies, which have each completed the physical decommissioning of their respective nuclear power facilities and are now engaged in the long-term storage of their spent fuel. The Yankee Companies ~~collect~~fund these costs through litigation proceeds received from the DOE and, to the extent necessary, through wholesale, FERC-approved rates charged under power purchase agreements with several New England utilities, including CL&P, NSTAR Electric ~~PSNH~~ and ~~WMECO. These companies~~PSNH. CL&P, NSTAR Electric and PSNH, in turn recover these costs from their customers through state regulatory commission-approved retail rates. The Yankee Companies ~~have collected or are currently collecting~~collect amounts that management believes are adequate to recover the remaining plant closure and fuel storage cost estimates for the respective plants. Management believes CL&P and NSTAR Electric ~~and WMECO~~ will recover their shares of these obligations from their customers. PSNH has recovered its total share of these costs from its customers.

Spent Nuclear Fuel Litigation:

The Yankee Companies have filed complaints against the DOE in the Court of Federal Claims seeking monetary damages resulting from the DOE's failure to accept delivery of, and provide for a permanent facility to store, spent nuclear fuel pursuant to the terms of the 1983 spent fuel and ~~high level~~high-level waste disposal contracts between the Yankee Companies and the DOE. The court ~~had~~ previously awarded the Yankee Companies damages for ~~Phase~~Phases I, II, III and ~~III~~IV of litigation resulting from the DOE's failure to meet its contractual obligations. These Phases covered damages incurred in the years 1998 through ~~2012,~~2016, and the awarded damages have been received by the Yankee Companies with certain amounts of the damages refunded to their customers.

DOE Phase IVV Damages - On ~~May 22, 2017,~~March 25, 2021, each of the Yankee Companies filed ~~subsequent~~a fifth set of lawsuits against the DOE in the Court of Federal ~~Claims~~Claims. The Yankee Companies are calculating and will be seeking monetary damages ~~totaling approximately $100 million~~ for CYAPC, YAEC and MYAPC, resulting from the DOE's failure to begin accepting spent nuclear fuel for disposal covering the years from ~~2013~~2017 to ~~2016 (“DOE~~2020 (DOE Phase ~~IV”)~~V). ~~The DOE Phase IV trial is expected to begin in 2018.~~

~~For further discussion, see Part I, Item 3, “Legal Proceedings -~~ ~~Yankee Companies v. U.S. Department of Energy” of our 2016 Form 10-K.~~

D.E. FERC ROE Complaints

Four separate complaints ~~have been~~were 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")~~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 billed of 10.57 percent and the maximum ROE for transmission incentive ~~("incentive cap")~~(incentive cap) of 11.74 percent, asserting that these ROEs were unjust and unreasonable.

~~In response to appeals~~The ROE originally billed during the period October 1, 2011 (beginning of ~~the FERC decision in~~ the first complaint filed 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 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 October 1, 2011 and~~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 base ROE at 10.57 percent and the incentive cap at 11.74 percent for the first complaint ~~period and~~period. This was also effective ~~from~~for all prospective billings to customers beginning October 16, ~~2014 through~~2014. This FERC order was vacated on April 14, 2017 by the ~~date on which~~U.S. Court of Appeals for the ~~Court vacated this FERC order.~~D.C. Circuit (the Court).

⁽²⁾ ~~CL&P, NSTAR Electric, PSNH and WMECO have refunded all~~All amounts associated with the first complaint period ~~totaling~~have been refunded, which totaled $38.9 million (pre-tax and excluding interest) at Eversource ~~(consisting 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~~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~~Eversource has recorded a reserve of $39.1 million (pre-tax and excluding interest) for the second complaint period as of September 30, 2021 and December 31, 2020. 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.~~2021 and December 31, 2020.

On June 5, 2017, the NETOs, including Eversource, submitted a filing to the FERC to reinstate the base ROE of 11.14 percent with an associated ROE incentive cap of 13.5 percent effective June 8, 2017, as these were the last ROEs lawfully in effect for transmission billing purposes prior to the FERC order vacated by 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 percent base ROE with an 11.74 percent incentive cap ROE) set in the first complaint proceeding until the FERC addresses the Court’s decision.

On October ~~5, 2017~~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. Initial briefs were filed by the NETOs, Complainants and FERC Trial Staff on January 11, 2019 and reply briefs were filed ~~a series~~on March 8, 2019. The NETOs' brief was supportive of ~~motions, requesting that~~ the ~~FERC dismiss~~overall ROE methodology determined in the ~~four complaint proceedings. Alternatively, if~~October 16, 2018 order provided the FERC does not ~~dismiss~~change the ~~proceedings,~~proposed methodology or alter its implementation in a manner that has a material impact on the results.

The FERC order included illustrative calculations for the first complaint using FERC's proposed frameworks with financial data from that complaint. Those illustrative calculations indicated that for the first complaint period, for the NETOs, ~~requested that~~which FERC concludes are of average financial risk, the preliminary just and reasonable base ROE is 10.41 percent and the preliminary incentive cap on total ROE is 13.08 percent.

If the results of the illustrative calculations were included in a final FERC order for each of the complaint periods, then a 10.41 percent base ROE and a 13.08 percent incentive cap would not have a significant impact on our financial statements for all of the complaint periods. These preliminary calculations are not binding and do not represent what we believe to be the most likely outcome of a final FERC order.

On November 21, 2019, FERC issued Opinion No. 569 affecting the two pending transmission ROE complaints against the Midcontinent ISO (MISO) transmission owners, in which FERC adopted a new methodology for determining base ROEs. Various parties sought rehearing. On December 23, 2019, the NETOs filed supplementary materials in the NETOs' four pending cases to respond to this new methodology because of the uncertainty of the applicability to the NETOs’ cases.

On May 21, 2020, the FERC ~~consolidate all~~issued its order in Opinion No. 569-A on the rehearing of the MISO transmission owners' cases, in which FERC again changed its methodology for determining the MISO transmission owners' base ROEs. Various parties appealed the MISO transmission owners' opinion. On November 19, 2020, the FERC issued Opinion No. 569-B denying rehearing of Opinion No. 569-A and reaffirmed the methodology previously adopted in Opinion No. 569-A. The new methodology differs significantly from the methodology proposed by FERC in its October 16, 2018 order to determine the NETOs' base ROEs in its four pending cases.

Given the significant uncertainty regarding the applicability of the FERC opinions in the MISO transmission owners' two complaint cases to the NETOs' pending four complaint ~~proceedings for expeditious resolution and/or stay the trial in the fourth complaint proceeding and resolve it based on the standards set in the April 14, 2017 Court decision.~~

~~At this time, the Company cannot reasonably estimate a range of gain or loss for the complaint proceedings. The April 14, 2017 Court decision did not provide a~~cases, Eversource concluded that there is no 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~~periods at this ~~time predict the ultimate effect~~time. As well, Eversource cannot reasonably estimate a range of ~~the Court decision~~any gain or ~~future FERC action on~~loss for any of the four complaint ~~periods or the estimated impacts on the financial position, results of operations or cash flows of~~ proceedings at this time.

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.

E.F. Eversource and NSTAR Electric Boston Harbor Civil Action

~~On July 15,~~In 2016, the United States Attorney on behalf of the United States Army Corps of Engineers filed a civil action in the United States District Court for the District of Massachusetts ~~under provisions of the Rivers 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"),~~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~~The parties reached a settlement ~~whereby~~pursuant to which HEEC ~~will~~agreed to 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~~Construction of the new distribution cable was completed in August 2019, and ~~the~~ removal of the portions of the existing cable ~~all~~was completed in January 2020. All issues surrounding the current permit from the United States Army Corps of Engineers are expected to be resolved, and subsequently, such litigation ~~is expected to be~~then dismissed with prejudice.

G. CL&P Regulatory Matters

CL&P Tropical Storm Isaias Response Investigation: In August 2020, PURA opened a docket to investigate the preparation for and response to Tropical Storm Isaias by Connecticut utilities, including CL&P. On April 28, 2021, PURA issued a final decision on CL&P’s compliance with its emergency response plan that concluded CL&P failed to comply with certain storm performance standards and was imprudent in certain instances. Specifically, PURA concluded that CL&P did not satisfy the performance standards for managing its municipal liaison program, timely removing electrical hazards from blocked roads, communicating critical information to its customers, or meeting its obligation to secure adequate external contractor and mutual aid resources in a timely manner. Based on its findings, PURA ordered CL&P to adjust its future rates in a pending or future rate proceeding to reflect a monetary penalty in the form of a downward adjustment of 90 basis points in its allowed rate of return on equity (ROE), which is currently 9.25 percent. In its decision, PURA explained that additional monetary penalties and further enforcement orders pursuant to Connecticut statute would be considered in a separate proceeding that was initiated on May 6, 2021.

On May 6, 2021, as part of the penalty proceeding, PURA issued a notice of violation that included an assessment of $30 million, consisting of a $28.4 million civil penalty for non-compliance with storm performance standards to be provided as credits on customer bills and a $1.6 million fine for violations of accident reporting requirements to be paid to the State of Connecticut’s general fund. On July 14, 2021, PURA issued a final decision in this penalty proceeding that included an assessment of $28.6 million, maintaining the $28.4 million performance penalty and reducing the $1.6 million fine for accident reporting to $0.2 million. The $28.4 million performance penalty is currently being credited to customers on electric bills beginning on September 1, 2021 over a one-year period. The $28.4 million is the maximum statutory penalty amount under applicable Connecticut law in effect at the time of Tropical Storm Isaias, which is 2.5 percent of CL&P’s annual distribution revenues. The

liability for the performance penalty was recorded as a current regulatory liability on CL&P’s balance sheet and as a reduction to Operating Revenues on the nine months ended September 30, 2021 income statement. The after-tax earnings impact of this charge was $0.07 per share.

CL&P Settlement Agreement: On October 1, 2021, CL&P entered into a settlement agreement with the DEEP, Office of Consumer Counsel (OCC), Office of the Attorney General (AG) and the Connecticut Industrial Energy Consumers, resolving certain issues that arose in pending regulatory proceedings initiated by the PURA. PURA approved the settlement agreement on October 27, 2021. In the settlement agreement, CL&P agreed to provide a total of $65 million of customer credits to be distributed based on customer sales over a two-month period from December 1, 2021 to January 31, 2022. CL&P also agreed to irrevocably set aside $10 million to fund various customer assistance initiatives as directed by PURA for disbursement to state-designated purposes, with the objective of disbursing the funds prior to April 30, 2022, including providing credits to existing hardship and non-hardship customers carrying arrearages and other purposes. In the third quarter of 2021, CL&P recorded a current regulatory liability of $75 million on the balance sheet associated with the provisions of the settlement agreement, with a $65 million pre-tax charge as a reduction to Operating Revenues associated with the customer credits and a $10 million charge to Operations and Maintenance expense associated with the customer assistance initiatives on the three months ended September 30, 2021 income statement.

In ~~2017, as~~exchange for the $75 million of customer credits and assistance, PURA’s interim rate reduction docket was resolved without findings. As a result of the settlement ~~NSTAR Electric expensed $4.9 million (pre-tax) of previously incurred capitalized costs associated with engineering work performed~~agreement, neither the 90 basis point reduction to CL&P’s return on equity introduced in PURA’s storm-related decision issued April 28, 2021, nor the ~~existing cable~~45 basis point reduction to CL&P’s return on equity included in PURA’s draft decision issued September 14, 2021 in the interim rate reduction docket, will be implemented.

CL&P has also agreed that ~~will no longer~~its current base distribution rates shall be ~~used. In addition, NSTAR Electric agreed to provide a rate base credit of $17.5 million~~frozen, subject to the ~~Massachusetts Water Resources Authority for~~customer credits described above, until no earlier than January 1, 2024. The rate freeze applies only to base distribution rates (including storm costs) and not to other rate mechanisms such as the ~~new cable. This negotiated credit will result in the initial $17.5 million of construction costs on the new cable~~retail rate components, rate reconciling mechanisms, formula rates and any other adjustment mechanisms. The rate freeze also does not apply to ~~be expensed as incurred. Construction~~any cost recovery mechanism outside of the ~~new cable is expected~~base distribution rates with regard to grid-modernization initiatives or any other proceedings, either currently pending or that may be ~~completed in 2019.~~

~~9. PSNH GENERATION ASSET SALE~~

~~On June 10, 2015, Eversource and PSNH entered into~~initiated during 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~~rate freeze period, that may place additional obligations on CL&P. The approval of the ~~NHPUC staff,~~settlement agreement satisfies the ~~Office~~Connecticut statute of ~~Consumer Advocate, two State Senators, and several other parties. Under the terms~~rate review requirements that requires electric utilities to file a distribution rate case within four years of the Agreement, 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. last rate case.

As part of the ~~Agreement, PSNH~~settlement agreement, CL&P agreed to ~~forego recovery~~withdraw with prejudice its pending appeals of ~~$25 million~~PURA’s April 28, 2021 and July 14, 2021 decisions related to Storm Isaias and agreed to waive its right to file an appeal and seek a judicial stay of the ~~equity return related~~final decision in the interim rate reduction docket. The settlement agreement assures that CL&P will have the opportunity to petition for and demonstrate the ~~Clean Air Project.~~ prudence of the storm costs incurred to respond to customer outages associated with Storm Isaias in a future ratemaking proceeding.

~~On July 1, 2016,~~The cumulative pre-tax impact of 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,settlement agreement and the ~~final plan~~Storm Isaias assessment imposed in PURA’s April 28, 2021 and ~~auction process were approved by~~July 14, 2021 decisions totaled $103.6 million, and the ~~NHPUC in November 2016.~~

~~As of~~after-tax earnings impact was $85.8 million, or $0.25 per share, for the nine months ended September 30, ~~2017, PSNH's generation assets were as follows:~~2021.

(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") to sell its thermal and hydroelectric generation assets to private investors at purchase prices of $175 million and $83 million, respectively, subject to adjustments as set forth in each Agreement.

Upon completion, full recovery of 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 bonds that will be secured by a non-bypassable charge or through recoveries in future rates billed to PSNH's customers.

10. 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:


	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
As of September 30, 2021:
Preferred Stock Not Subject to Mandatory Redemption	$	155.6	$	165.5	$	116.2	$	121.4	$	43.0	$	44.1	$	—	$	—
Long-Term Debt	18,219.2		19,810.9		4,215.1		4,865.2		3,984.7		4,494.3		1,163.6		1,228.9
Rate Reduction Bonds	496.9		555.8		—		—		—		—		496.9		555.8

As of December 31, 2020:
Preferred Stock Not Subject to Mandatory Redemption	$	155.6	$	169.1	$	116.2	$	123.4	$	43.0	$	45.7	$	—	$	—
Long-Term Debt	16,179.1		18,420.1		3,914.8		4,800.9		3,643.2		4,294.0		1,099.1		1,207.0
Rate Reduction Bonds	540.1		603.4		—		—		—		—		540.1		603.4

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
(Millions of Dollars)
Carrying
Amount

Fair
Value

Carrying
Amount

Fair
Value

Carrying
Amount

Fair
Value

Carrying
Amount

Fair
Value
As of September 30, 2017:
Preferred Stock Not Subject to Mandatory Redemption $ 116.2
$ 115.9
$ 43.0
$ 44.4
$ —
$ —
$ —
$ —
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

As of December 31, 2016:
Preferred Stock Not Subject to Mandatory Redemption $ 116.2
$ 114.7
$ 43.0
$ 43.6
$ —
$ —
$ —
$ —
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

Derivative Instruments and Marketable Securities: Derivative instruments and investments in marketable securities are carried at fair value. For further information, see Note 4, "Derivative Instruments," and Note 5, "Marketable Securities," to the financial statements.

See Note 1D, "Summary of Significant Accounting Policies -– Fair Value Measurements," for the fair value measurement policy and the fair value hierarchy.

11. ACCUMULATED OTHER COMPREHENSIVE INCOME/(LOSS)

The changes in accumulated other comprehensive income/(loss) by component, net of tax, isare as follows:


	For the Nine Months Ended September 30, 2021								For the Nine Months Ended September 30, 2020
Eversource (Millions of Dollars)	Qualified Cash Flow Hedging Instruments		Unrealized Gains/(Losses) on Marketable Securities		Defined Benefit Plans		Total		Qualified Cash Flow Hedging Instruments		Unrealized Gains on Marketable Securities		Defined Benefit Plans		Total
Balance as of Beginning of Period	$	(1.4)	$	1.1	$	(76.1)	$	(76.4)	$	(3.0)	$	0.7	$	(62.8)	$	(65.1)

OCI Before Reclassifications	—		(0.6)		(2.4)		(3.0)		—		0.3		(1.6)		(1.3)
Amounts Reclassified from AOCI	1.0		—		6.5		7.5		1.2		—		4.8		6.0
Net OCI	1.0		(0.6)		4.1		4.5		1.2		0.3		3.2		4.7
Balance as of End of Period	$	(0.4)	$	0.5	$	(72.0)	$	(71.9)	$	(1.8)	$	1.0	$	(59.6)	$	(60.4)

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)
Eversource
(Millions of Dollars)
Hedging on Marketable Defined Hedging on Marketable Defined
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 )

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

Eversource's qualified cash flow hedging instruments represent interest rate swap agreements on debt issuances that were settled in prior years. The settlement amount was recorded in AOCL and is being amortized into Net Income over the term of the underlying debt instrument. CL&P, PSNH and WMECO continue to amortize interest rate swaps settled in prior years from AOCL into Interest Expense over the remaining life of the associated long-term debt. Such interest rate swaps are not material to their respective financial statements.

Defined benefit plan OCI amounts before reclassifications relate to actuarial gains and losses ~~and prior service costs~~ that arose during the year and were recognized in ~~AOCL.~~AOCI. The unamortized actuarial gains and losses and prior service costs on the defined benefit plans are amortized from ~~AOCL~~AOCI into ~~Operations and Maintenance expense~~Other Income, Net over the average future employee service period, and are reflected in amounts reclassified from ~~AOCL. For further information, see Note 7, "Pension Benefits and Postretirement Benefits Other Than Pensions."~~AOCI.

12. COMMON SHARES

The following table sets forth the Eversource parent common shares and the shares of common stock of CL&P, NSTAR Electric ~~PSNH~~ and ~~WMECO~~PSNH that were authorized and issued, as well as the respective per share par values:


	Shares
			Authorized as of September 30, 2021 and December 31, 2020	Issued as of
	Par Value			September 30, 2021	December 31, 2020
Eversource	$	5	380,000,000	357,818,402	357,818,402
CL&P	$	10	24,500,000	6,035,205	6,035,205
NSTAR Electric	$	1	100,000,000	200	200
PSNH	$	1	100,000,000	301	301

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

Treasury Shares:As of ~~both~~ September 30, ~~2017~~2021 and December 31, ~~2016,~~2020, there were ~~16,992,594~~ 14,044,078 and 14,864,379 Eversource common shares held as treasury ~~shares.~~shares, respectively. As of ~~both~~ September 30, ~~2017~~2021 and December 31, ~~2016,~~2020, Eversource common shares outstanding were 343,774,324 and 342,954,023, respectively.

Eversource issues treasury shares to satisfy awards under the Company's incentive plans, shares issued under the dividend reinvestment and share purchase plan, and matching contributions under the Eversource 401k Plan. The issuance of treasury shares represents a non-cash transaction, as the treasury shares were ~~316,885,808.~~used to fulfill Eversource's obligations that require the issuance of common shares.

13. COMMON SHAREHOLDERS' EQUITY AND NONCONTROLLING INTERESTS

Dividends on the preferred stock of CL&P and NSTAR Electric totaled $1.9 million for ~~both~~each of the three months ended September 30, ~~2017~~2021 and ~~2016,~~2020 and $5.6 million for ~~both~~each of the nine months ended September 30, ~~2017~~2021 and ~~2016.~~2020. These dividends were presented as Net Income Attributable to Noncontrolling Interests on the Eversource statements of income. Noncontrolling Interest – Preferred Stock of Subsidiaries on the Eversource balance sheets totaled $155.6 million as of September 30, ~~2017~~2021 and December 31, ~~2016.~~2020. On the Eversource balance sheets, Common Shareholders' Equity was fully attributable to ~~the~~Eversource parent and Noncontrolling Interest – Preferred Stock of Subsidiaries was fully attributable to the noncontrolling interest.

14. EARNINGS PER SHARE

Basic EPS is computed based upon the weighted average number of common shares outstanding during each period. Diluted EPS is computed on the basis of the weighted average number of common shares outstanding plus the potential dilutive effect of certain share-based compensation awards as if they were converted into outstanding common shares. The dilutive effect of unvested RSU and performance share awards is calculated using the treasury stock method. RSU and performance share awards are included in basic weighted average common shares outstanding as of the date that all necessary vesting conditions have been satisfied. ~~For the three and nine months ended September 30, 2017 and 2016, there~~There were no antidilutive share awards excluded from the computation of diluted ~~EPS.~~EPS for the three and nine months ended September 30, 2021 and the three months ended September 30, 2020. For the nine months ended September 30, 2020, there were 52,747 antidilutive share awards excluded from the EPS computation, as their impact would have been antidilutive. Antidilutive shares pertained to a purchase option extended to underwriters in connection with Eversource’s common share issuance on June 15, 2020.

The following table sets forth the components of basic and diluted EPS:


Eversource (Millions of Dollars, except share information)	For the Three Months Ended				For the Nine Months Ended
	September 30, 2021		September 30, 2020		September 30, 2021		September 30, 2020
Net Income Attributable to Common Shareholders	$	283.2	$	346.3	$	913.8	$	933.2
Weighted Average Common Shares Outstanding:
Basic	344,023,846		343,076,614		343,848,905		337,375,172
Dilutive Effect of:
Share-Based Compensation Awards and Other	645,936		696,988		631,151		686,403
Equity Forward Sale Agreement	—		—		—		362,525
Total Dilutive Effect	645,936		696,988		631,151		1,048,928
Diluted	344,669,782		343,773,602		344,480,056		338,424,100
Basic EPS	$	0.82	$	1.01	$	2.66	$	2.77
Diluted EPS	$	0.82	$	1.01	$	2.65	$	2.76

15. REVENUES

The following tables present operating revenues disaggregated by revenue source:


	For the Three Months Ended September 30, 2021
Eversource (Millions of Dollars)	Electric Distribution		Natural Gas Distribution		Electric Transmission		Water Distribution		Other		Eliminations		Total
Revenues from Contracts with Customers
Retail Tariff Sales
Residential	$	1,146.8	$	81.7	$	—	$	39.1	$	—	$	—	$	1,267.6
Commercial	748.8		59.0		—		17.2		—		(1.4)		823.6
Industrial	96.2		28.6		—		1.1		—		(4.8)		121.1
Total Retail Tariff Sales Revenues	1,991.8		169.3		—		57.4		—		(6.2)		2,212.3
Wholesale Transmission Revenues	—		—		527.2		—		23.0		(408.5)		141.7
Wholesale Market Sales Revenues	133.8		12.2		—		1.1		—		—		147.1
Other Revenues from Contracts with Customers	29.6		1.2		3.5		1.8		303.1		(301.4)		37.8
Reserve for Revenues Subject to Refund (1)	(93.4)		—		—		(0.9)		—		—		(94.3)
Total Revenues from Contracts with Customers	2,061.8		182.7		530.7		59.4		326.1		(716.1)		2,444.6
Alternative Revenue Programs	(7.9)		2.7		(112.6)		2.3		—		102.0		(13.5)
Other Revenues (2)	1.3		0.1		0.2		0.1		—		—		1.7
Total Operating Revenues	$	2,055.2	$	185.5	$	418.3	$	61.8	$	326.1	$	(614.1)	$	2,432.8

	For the Nine Months Ended September 30, 2021
Eversource (Millions of Dollars)	Electric Distribution		Natural Gas Distribution		Electric Transmission		Water Distribution		Other		Eliminations		Total
Revenues from Contracts with Customers
Retail Tariff Sales
Residential	$	3,094.9	$	722.8	$	—	$	102.8	$	—	$	—	$	3,920.5
Commercial	1,902.9		356.4		—		47.0		—		(4.1)		2,302.2
Industrial	261.1		119.5		—		3.3		—		(12.8)		371.1
Total Retail Tariff Sales Revenues	5,258.9		1,198.7		—		153.1		—		(16.9)		6,593.8
Wholesale Transmission Revenues	—		—		1,338.4		—		62.5		(1,075.4)		325.5
Wholesale Market Sales Revenues	380.1		54.1		—		3.0		—		—		437.2
Other Revenues from Contracts with Customers	68.4		3.6		10.2		5.5		936.6		(929.6)		94.7
Reserve for Revenues Subject to Refund (1)	(93.4)		—		—		(2.2)		—		—		(95.6)
Total Revenues from Contracts with Customers	5,614.0		1,256.4		1,348.6		159.4		999.1		(2,021.9)		7,355.6
Alternative Revenue Programs	14.9		21.3		(119.2)		1.3		—		103.0		21.3
Other Revenues (2)	3.2		0.1		0.7		0.3		—		—		4.3
Total Operating Revenues	$	5,632.1	$	1,277.8	$	1,230.1	$	161.0	$	999.1	$	(1,918.9)	$	7,381.2

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


	For the Three Months Ended September 30, 2020
Eversource (Millions of Dollars)	Electric Distribution		Natural Gas Distribution		Electric Transmission		Water Distribution		Other		Eliminations		Total
Revenues from Contracts with Customers
Retail Tariff Sales
Residential	$	1,183.9	$	45.5	$	—	$	45.8	$	—	$	—	$	1,275.2
Commercial	682.7		41.1		—		17.1		—		(1.4)		739.5
Industrial	91.0		17.5		—		1.3		—		(3.6)		106.2
Total Retail Tariff Sales Revenues	1,957.6		104.1		—		64.2		—		(5.0)		2,120.9
Wholesale Transmission Revenues	—		—		458.2		—		19.0		(365.6)		111.6
Wholesale Market Sales Revenues	79.6		8.7		—		1.1		—		—		89.4
Other Revenues from Contracts with Customers	20.7		1.3		3.2		0.7		303.3		(299.0)		30.2

Total Revenues from Contracts with Customers	2,057.9		114.1		461.4		66.0		322.3		(669.6)		2,352.1
Alternative Revenue Programs	1.7		(4.0)		(72.3)		(2.0)		—		67.0		(9.6)
Other Revenues (2)	0.7		0.1		0.2		0.1		—		—		1.1
Total Operating Revenues	$	2,060.3	$	110.2	$	389.3	$	64.1	$	322.3	$	(602.6)	$	2,343.6


	For the Nine Months Ended September 30, 2020
Eversource (Millions of Dollars)	Electric Distribution		Natural Gas Distribution		Electric Transmission		Water Distribution		Other		Eliminations		Total
Revenues from Contracts with Customers
Retail Tariff Sales
Residential	$	3,063.7	$	399.6	$	—	$	113.2	$	—	$	—	$	3,576.5
Commercial	1,815.7		243.5		—		47.7		—		(3.7)		2,103.2
Industrial	248.4		67.0		—		3.6		—		(10.1)		308.9
Total Retail Tariff Sales Revenues	5,127.8		710.1		—		164.5		—		(13.8)		5,988.6
Wholesale Transmission Revenues	—		—		1,177.9		—		55.6		(981.4)		252.1
Wholesale Market Sales Revenues	231.1		31.9		—		2.9		—		—		265.9
Other Revenues from Contracts with Customers	63.3		4.1		9.9		2.8		845.1		(838.0)		87.2

Total Revenues from Contracts with Customers	5,422.2		746.1		1,187.8		170.2		900.7		(1,833.2)		6,593.8
Alternative Revenue Programs	54.8		22.9		(52.7)		(4.1)		—		48.9		69.8
Other Revenues (2)	4.9		1.0		0.5		0.5		—		—		6.9
Total Operating Revenues	$	5,481.9	$	770.0	$	1,135.6	$	166.6	$	900.7	$	(1,784.3)	$	6,670.5



	For the Three Months Ended September 30, 2021						For the Three Months Ended September 30, 2020
(Millions of Dollars)	CL&P		NSTAR Electric		PSNH		CL&P		NSTAR Electric		PSNH
Revenues from Contracts with Customers
Retail Tariff Sales
Residential	$	572.0	$	401.9	$	172.9	$	608.7	$	415.4	$	159.8
Commercial	249.4		411.3		88.5		244.7		358.3		80.1
Industrial	35.0		35.9		25.3		38.0		30.6		22.4
Total Retail Tariff Sales Revenues	856.4		849.1		286.7		891.4		804.3		262.3
Wholesale Transmission Revenues	268.2		171.0		88.0		233.3		153.1		71.8
Wholesale Market Sales Revenues	100.3		21.3		12.2		60.0		12.1		7.5
Other Revenues from Contracts with Customers	12.1		14.3		7.3		8.1		10.5		3.7
(Reserve for)/Amortization of Revenues Subject to Refund (1)	(93.4)		—		—		—		—		2.3
Total Revenues from Contracts with Customers	1,143.6		1,055.7		394.2		1,192.8		980.0		347.6
Alternative Revenue Programs	(82.0)		(14.4)		(24.1)		(65.0)		8.2		(13.8)
Other Revenues (2)	0.2		0.7		0.6		0.2		0.7		—
Eliminations	(142.2)		(123.3)		(55.8)		(133.7)		(113.5)		(50.1)
Total Operating Revenues	$	919.6	$	918.7	$	314.9	$	994.3	$	875.4	$	283.7

~~15.~~



	For the Nine Months Ended September 30, 2021						For the Nine Months Ended September 30, 2020
(Millions of Dollars)	CL&P		NSTAR Electric		PSNH		CL&P		NSTAR Electric		PSNH
Revenues from Contracts with Customers
Retail Tariff Sales
Residential	$	1,558.6	$	1,069.0	$	467.3	$	1,567.9	$	1,057.9	$	437.9
Commercial	679.3		975.7		249.2		670.4		921.3		225.3
Industrial	100.2		89.5		71.4		105.3		82.1		61.0
Total Retail Tariff Sales Revenues	2,338.1		2,134.2		787.9		2,343.6		2,061.3		724.2
Wholesale Transmission Revenues	652.8		478.2		207.4		576.5		430.3		171.1
Wholesale Market Sales Revenues	278.1		64.7		37.3		163.9		39.8		27.4
Other Revenues from Contracts with Customers	28.8		36.8		14.9		25.1		32.4		10.9
(Reserve for)/Amortization of Revenues Subject to Refund (1)	(93.4)		—		—		—		—		6.9
Total Revenues from Contracts with Customers	3,204.4		2,713.9		1,047.5		3,109.1		2,563.8		940.5
Alternative Revenue Programs	(74.2)		(11.3)		(18.8)		(27.8)		31.1		(1.2)
Other Revenues (2)	0.3		2.5		1.1		2.0		2.8		0.6
Eliminations	(394.0)		(362.0)		(142.6)		(371.9)		(327.5)		(124.6)
Total Operating Revenues	$	2,736.5	$	2,343.1	$	887.2	$	2,711.4	$	2,270.2	$	815.3

(1) The Electric Distribution segment 2021 revenue subject to refund amount relates to an October 1, 2021 CL&P settlement agreement with the DEEP, OCC, AG and the Connecticut Industrial Energy Consumers, which resolved certain issues that arose in pending regulatory proceedings initiated by the PURA. In the third quarter of 2021, CL&P recorded a reduction to Operating Revenues of $65 million on the income statement for a reserve for customer credits associated with the provisions of the settlement agreement. Additionally, CL&P recorded a $28.4 million reserve in the first quarter of 2021 for a civil penalty for non-compliance with storm performance standards to be credited to customers. The penalty was reclassified from Operations and Maintenance expense to a reduction of Operating Revenues in the third quarter of 2021 in connection with the finalization of the settlement agreement. In total, the reserve for revenues subject to refund totaled $93.4 million and was recorded as a current regulatory liability on CL&P’s balance sheet and as a reduction to Operating Revenues on the nine months ended September 30, 2021 income statement. See Note 9G, “Commitments and Contingencies - CL&P Regulatory Matters,” for further information.

(2) Other Revenues include certain fees charged to customers that are not considered revenue from contracts with customers. Other Revenues also include lease revenues under lessor accounting guidance of $1.1 million (including $0.2 million at CL&P and $0.7 million at NSTAR Electric) and $1.1 million (including $0.2 million at CL&P and $0.7 million at NSTAR Electric) for the three months ended September 30, 2021 and 2020, respectively, and $3.8 million (including $0.6 million at CL&P and $2.5 million at NSTAR Electric) and $3.2 million (including $0.6 million at CL&P and $2.1 million at NSTAR Electric) for the nine months ended September 30, 2021 and 2020, respectively.

16. SEGMENT INFORMATION

~~Presentation:~~Eversource is organized ~~among~~into the Electric Distribution, Electric Transmission, ~~and~~ Natural Gas Distribution and Water Distribution reportable segments and Other based on a combination of factors, including the characteristics of each segments' services, the sources of operating revenues and expenses and the regulatory environment in which each segment operates. These reportable segments represent substantially all of Eversource's total consolidated revenues. Revenues from the sale of electricity, ~~and~~ natural gas and water primarily are derived from residential, commercial and industrial customers and are not dependent on any single customer. The Electric Distribution reportable segment includes the ~~generation activities~~results of NSTAR ~~Electric, PSNH~~Electric's solar power facilities. Eversource's reportable segments are determined based upon the level at which Eversource's chief operating decision maker assesses performance and ~~WMECO.~~ makes decisions about the allocation of company resources.

The remainder of Eversource's operations is presented as Other in the tables below and primarily consists of 1) the equity in earnings of Eversource parent from its subsidiaries and intercompany interest income, both of which are eliminated in consolidation, and interest expense related to the debt of Eversource parent, 2) the revenues and expenses of Eversource Service, most of which are eliminated in consolidation, 3) the operations of CYAPC and YAEC, ~~and~~ 4) the results of other unregulated subsidiaries, which are not part of its core ~~business. In addition, Other in the tables below includes~~business, and 5) Eversource parent's equity ownership interests ~~in certain~~that are not consolidated, which primarily include the offshore wind business, anatural gas pipeline ~~projects~~ owned by Enbridge, Inc., ~~the Bay State Wind project,~~and a renewable energy investment ~~fund, and two companies that transmit hydroelectricity imported from the Hydro-Quebec system in Canada.~~ fund.

In the ordinary course of business, Yankee Gas, ~~and~~ NSTAR Gas and EGMA purchase natural gas transmission services from the Enbridge, Inc. natural gas pipeline ~~projects~~project described above. These affiliate transaction costs total ~~approximately $62.5~~$77.7 million annually and are classified as Purchased Power, Fuel and Transmission on the Eversource statements of income.

Each of Eversource's subsidiaries, including CL&P, NSTAR Electric and PSNH, has 1 reportable segment.

Cash flows used for investments in plant included in the segment information below are cash capital expenditures that do not include amounts incurred but not paid, cost of removal, AFUDC related to equity funds, and the capitalized portions of pension and PBOP expense.

Eversource's reportable segments are determined based upon the level at which Eversource's chief operating decision maker assesses performance and makes decisions about the allocation of company resources. Each of Eversource's subsidiaries, including CL&P, NSTAR Electric, PSNH and WMECO, has one reportable segment. Eversource's operating segments and reporting units are consistent with its reportable business segments.

Eversource's segment information is as follows:


	For the Three Months Ended September 30, 2021
Eversource (Millions of Dollars)	Electric Distribution		Natural Gas Distribution		Electric Transmission		Water Distribution		Other		Eliminations		Total
Operating Revenues	$	2,055.2	$	185.5	$	418.3	$	61.8	$	326.1	$	(614.1)	$	2,432.8
Depreciation and Amortization	(179.8)		(28.5)		(75.4)		(11.5)		(28.0)		1.1		(322.1)
Other Operating Expenses	(1,640.5)		(176.9)		(122.4)		(26.1)		(275.2)		613.7		(1,627.4)
Operating Income/(Loss)	$	234.9	$	(19.9)	$	220.5	$	24.2	$	22.9	$	0.7	$	483.3
Interest Expense	$	(61.0)	$	(15.7)	$	(33.5)	$	(8.0)	$	(42.5)	$	12.7	$	(148.0)
Other Income, Net	25.4		6.7		5.0		1.2		325.9		(320.4)		43.8
Net Income/(Loss) Attributable to Common Shareholders	150.4		(22.0)		139.4		17.5		304.9		(307.0)		283.2

	For the Nine Months Ended September 30, 2021
Eversource (Millions of Dollars)	Electric Distribution		Natural Gas Distribution		Electric Transmission		Water Distribution		Other		Eliminations		Total
Operating Revenues	$	5,632.1	$	1,277.8	$	1,230.1	$	161.0	$	999.1	$	(1,918.9)	$	7,381.2
Depreciation and Amortization	(534.1)		(108.7)		(223.4)		(34.3)		(83.7)		3.1		(981.1)
Other Operating Expenses	(4,531.3)		(970.6)		(359.6)		(76.7)		(860.3)		1,918.9		(4,879.6)
Operating Income	$	566.7	$	198.5	$	647.1	$	50.0	$	55.1	$	3.1	$	1,520.5
Interest Expense	$	(175.4)	$	(44.2)	$	(98.7)	$	(24.0)	$	(125.9)	$	37.0	$	(431.2)
Other Income, Net	76.0		15.2		17.3		3.1		1,059.2		(1,046.2)		124.6
Net Income Attributable to Common Shareholders	365.4		129.6		412.4		30.0		982.5		(1,006.1)		913.8
Cash Flows Used for Investments in Plant	764.9		506.4		691.0		91.2		157.6		—		2,211.1


	For the Three Months Ended September 30, 2017																			For the Three Months Ended September 30, 2020
Eversource (Millions of Dollars)	Electric Distribution			Natural Gas Distribution			Electric Transmission			Other			Eliminations			Total			Eversource (Millions of Dollars)	Electric Distribution		Natural Gas Distribution (1)		Electric Transmission		Water Distribution		Other (1)		Eliminations (1)		Total
Operating Revenues	$	1,547.1		$	109.2		$	328.5		$	224.2		$	(220.5	)	$	1,988.5		Operating Revenues	$	2,060.3	$	110.2	$	389.3	$	64.1	$	322.3	$	(602.6)	$	2,343.6
Depreciation and Amortization	(159.6		)	(15.2		)	(52.6		)	(9.5		)	0.6			(236.3		)	Depreciation and Amortization	(182.0)		(14.8)		(70.6)		(10.8)		(24.1)		0.3		(302.0)
Other Operating Expenses	(1,088.7		)	(95.5		)	(95.5		)	(190.0		)	220.1			(1,249.6		)	Other Operating Expenses	(1,577.0)		(104.2)		(120.6)		(10.2)		(271.5)		603.1		(1,480.4)
Operating Income/(Loss)	$	298.8		$	(1.5	)	$	180.4		$	24.7		$	0.2		$	502.6		Operating Income/(Loss)	$	301.3	$	(8.8)	$	198.1	$	43.1	$	26.7	$	0.8	$	561.2
Interest Expense	$	(51.3	)	$	(10.8	)	$	(29.2	)	$	(21.8	)	$	4.4		$	(108.7	)	Interest Expense	$	(53.3)	$	(10.1)	$	(31.1)	$	(8.0)	$	(38.7)	$	7.1	$	(134.1)
Other Income, Net	7.7			0.3			8.5			267.5			(262.8		)	21.2			Other Income, Net	16.0		0.7		6.9		1.6		401.0		(397.0)		29.2
Net Income/(Loss) Attributable to Common Shareholders	157.4			(6.2		)	99.0			268.4			(258.2		)	260.4			Net Income/(Loss) Attributable to Common Shareholders	205.5		(15.4)		125.6		23.1		396.6		(389.1)		346.3

	For the Nine Months Ended September 30, 2017																			For the Nine Months Ended September 30, 2020
Eversource (Millions of Dollars)	Electric Distribution			Natural Gas Distribution			Electric Transmission			Other			Eliminations			Total			Eversource (Millions of Dollars)	Electric Distribution		Natural Gas Distribution (1)		Electric Transmission		Water Distribution		Other (1)		Eliminations (1)		Total
Operating Revenues	$	4,224.2		$	698.8		$	970.0		$	677.5		$	(714.0	)	$	5,856.5		Operating Revenues	$	5,481.9	$	770.0	$	1,135.6	$	166.6	$	900.7	$	(1,784.3)	$	6,670.5
Depreciation and Amortization	(394.9		)	(54.8		)	(154.5		)	(26.7		)	1.7			(629.2		)	Depreciation and Amortization	(490.0)		(55.1)		(206.8)		(33.1)		(68.1)		1.2		(851.9)
Other Operating Expenses	(3,056.0		)	(535.2		)	(280.4		)	(602.4		)	714.0			(3,760.0		)	Other Operating Expenses	(4,309.9)		(592.0)		(338.5)		(60.7)		(771.4)		1,787.9		(4,284.6)
Operating Income	$	773.3		$	108.8		$	535.1		$	48.4		$	1.7		$	1,467.3		Operating Income	$	682.0	$	122.9	$	590.3	$	72.8	$	61.2	$	4.8	$	1,534.0
Interest Expense	$	(149.0	)	$	(32.3	)	$	(86.1	)	$	(63.1	)	$	11.0		$	(319.5	)	Interest Expense	$	(160.7)	$	(32.1)	$	(93.8)	$	(25.1)	$	(119.0)	$	27.6	$	(403.1)
Other Income, Net	15.2			0.8			20.1			853.9			(833.7		)	56.3			Other Income, Net	44.9		2.5		22.7		1.7		1,087.9		(1,076.1)		83.6
Net Income Attributable to Common Shareholders	393.4			49.1			289.6			839.5			(821.0		)	750.6			Net Income Attributable to Common Shareholders	450.6		73.3		381.8		35.6		1,035.6		(1,043.7)		933.2
Cash Flows Used for Investments in Plant	752.4			209.8			575.6			104.5			—			1,642.3			Cash Flows Used for Investments in Plant	781.2		322.8		732.4		84.0		181.2		—		2,101.6

For the Three Months Ended September 30, 2016
Eversource
(Millions of Dollars)
Electric
Distribution

Natural Gas
Distribution

Electric
Transmission
Other Eliminations Total
Operating Revenues $ 1,623.4
$ 99.2
$ 306.8
$ 211.5
$ (201.2 ) $ 2,039.7
Depreciation and Amortization (154.8 ) (15.2 ) (47.1 ) (8.6 ) 0.5
(225.2 )
Other Operating Expenses (1,146.8 ) (87.8 ) (90.2 ) (179.3 ) 199.5
(1,304.6 )
Operating Income/(Loss) $ 321.8
$ (3.8 ) $ 169.5
$ 23.6
$ (1.2 ) $ 509.9
Interest Expense $ (49.0 ) $ (10.2 ) $ (26.9 ) $ (15.1 ) $ 1.3
$ (99.9 )
Other Income, Net 5.3
0.6
6.3
256.9
(255.5 ) 13.6
Net Income/(Loss) Attributable to
Common Shareholders
170.1
(7.0 ) 88.4
268.5
(254.7 ) 265.3

For the Nine Months Ended September 30, 2016
Eversource
(Millions of Dollars)
Electric
Distribution

Natural Gas
Distribution

Electric
Transmission
Other Eliminations Total
Operating Revenues $ 4,362.6
$ 622.3
$ 892.5
$ 636.8
$ (651.7 ) $ 5,862.5
Depreciation and Amortization (380.9 ) (47.9 ) (137.7 ) (23.1 ) 1.6
(588.0 )
Other Operating Expenses (3,230.1 ) (462.4 ) (245.7 ) (564.7 ) 650.2
(3,852.7 )
Operating Income $ 751.6
$ 112.0
$ 509.1
$ 49.0
$ 0.1
$ 1,421.8
Interest Expense $ (144.6 ) $ (30.8 ) $ (82.2 ) $ (45.8 ) $ 4.8
$ (298.6 )
Other Income, Net 11.6
0.5
14.2
781.4
(784.0 ) 23.7
Net Income Attributable to Common Shareholders 381.3
51.9
266.6
791.7
(778.4 ) 713.1
Cash Flows Used for Investments in Plant 570.9
170.3
536.2
81.8
—
1,359.2
(1) On October 9, 2020, Eversource completed the CMA asset acquisition, with Yankee Energy System, Inc. (Yankee parent) as the acquiring entity. Yankee parent is the parent company of Yankee Gas, NSTAR Gas, EGMA and Hopkinton LNG Corp. As a result of the acquisition, in the fourth quarter of 2020, our chief operating decision maker assessed the performance of the Natural Gas Distribution segment including Yankee parent. Previously, Yankee parent was presented within Other and its equity in earnings were eliminated in consolidation. Prior comparative periods were revised to conform to the current period segment presentation.

The following table summarizes Eversource's segmented total assets:


Eversource (Millions of Dollars)	Electric Distribution		Natural Gas Distribution		Electric Transmission		Water Distribution		Other		Eliminations		Total
As of September 30, 2021	$	25,604.2	$	6,865.6	$	12,123.5	$	2,444.9	$	21,624.5	$	(20,648.6)	$	48,014.1
As of December 31, 2020	24,981.9		6,450.5		11,695.0		2,375.2		22,089.4		(21,492.4)		46,099.6

Eversource
(Millions of Dollars)
Electric
Distribution

Natural Gas
Distribution
Electric
Transmission Other Eliminations Total
As of September 30, 2017 $ 18,826.0
$ 3,432.6
$ 9,290.3
$ 14,939.4
$ (13,324.7 ) $ 33,163.6
As of December 31, 2016 18,367.5
3,303.8
8,751.5
14,493.1
(12,862.7 ) 32,053.2

17. ACQUISITION OF ASSETS OF COLUMBIA GAS OF MASSACHUSETTS

On October 9, 2020, Eversource acquired certain assets and liabilities that comprised the NiSource Inc. (NiSource) natural gas distribution business in Massachusetts, which was previously doing business as CMA, pursuant to an asset purchase agreement (the Agreement) entered into on February 26, 2020 between Eversource and NiSource. The cash purchase price was $1.1 billion, plus a working capital amount of $68.6 million, as finalized in the first quarter of 2021. The natural gas distribution assets acquired from CMA were assigned to EGMA, an indirect wholly-owned subsidiary of Eversource formed in 2020. The LNG assets acquired from CMA were assigned to Hopkinton LNG Corp.

Preliminary Purchase Price Allocation: The purchase price allocation reflects measurement period adjustments recorded in 2021 to reduce the fair values of certain regulatory and plant assets and certain liabilities acquired, resulting in a corresponding increase to Goodwill, based on new information received during the measurement period.

The preliminary allocation of the cash purchase price is as follows:


(Millions of Dollars)
Current Assets	$	138
Restricted Cash	57
PP&E	1,184
Goodwill	50
Other Noncurrent Assets, excluding Goodwill	131
Other Current Liabilities	(81)
Other Noncurrent Liabilities	(310)
Cash Purchase Price	$	1,169

EVERSOURCE ENERGY AND SUBSIDIARIES

Management's Discussion and Analysis of Financial Condition and Results of Operations

The following discussion and analysis should be read in conjunction with our unaudited condensed consolidated financial statements and related combined notes included in this combined Quarterly Report on Form 10-Q, the combined ~~quarterly reports~~Quarterly Report on Form 10-Q for the quarters ended March 31, ~~2017~~2021 and June 30, ~~2017,~~2021, as well as the Eversource ~~2016~~2020 combined Annual Report on Form 10-K. References in this combined Quarterly Report on Form 10-Q to "Eversource," the "Company," "we," "us," and "our" refer to Eversource Energy and its consolidated subsidiaries. All per-share amounts are reported on a diluted basis. The unaudited condensed consolidated financial statements of Eversource, NSTAR Electric and PSNH and the unaudited condensed financial statements of CL&P ~~and WMECO~~ are herein collectively referred to as the "financial statements."

Refer to the Glossary of Terms included in this combined Quarterly Report on Form 10-Q for abbreviations and acronyms used throughout this Management's Discussion and Analysis of Financial Condition and Results of Operations.

The only common equity securities that are publicly traded are common shares of Eversource. The earnings and EPS of each business discussed below do not represent a direct legal interest in the assets and liabilities of such business, but rather represent a direct interest in our assets and liabilities as a whole. EPS by business is a financial measure not recognized under GAAP (non-GAAP) that is calculated by dividing the Net Income Attributable to Common Shareholders of each business by the weighted average diluted Eversource common shares outstanding for the period. Our earnings discussion also includes non-GAAP financial measures referencing our 2021 earnings and EPS excluding charges at CL&P related to a settlement agreement that included credits to customers and funding of various customer assistance initiatives and a storm performance penalty imposed on CL&P by PURA and our 2021 and 2020 earnings and EPS excluding certain acquisition and transition costs.

We use ~~this~~these non-GAAP financial ~~measure~~measures to evaluate and provide details of earnings results by ~~business.~~business and to more fully compare and explain our 2021 and 2020 results without including these items. This information is among the primary indicators we use as a basis for evaluating performance and planning and forecasting of future periods. We believe the impacts of the CL&P settlement agreement, the storm performance penalty imposed on CL&P by PURA, and acquisition and transition costs are not indicative of our ongoing costs and performance. We view these charges as not directly related to the ongoing operations of the business and therefore not an indicator of baseline operating performance. Due to the nature and significance of the effect of these items on Net Income Attributable to Common Shareholders and EPS, we believe that the non-GAAP presentation is a more meaningful ~~representative~~representation of our financial performance and provides additional and useful information to readers of this report in analyzing historical and future performance byof our business. ~~This~~These non-GAAP financial ~~measure~~measures should not be considered as ~~an alternative~~alternatives to reported Net Income Attributable to Common Shareholders or EPS determined in accordance with GAAP as ~~an indicator~~indicators of operating performance.

~~From time to time, we~~We make statements concerning our expectations, beliefs, plans, objectives, goals, strategies, assumptions of future events, future financial performance or growth and other statements that are not historical facts. These statements are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. You can generally identify our forward-looking statements through the use of words or phrases such as "estimate," "expect," "anticipate," "intend," "plan," "project," "believe," "forecast," "should," "could," and other similar expressions. Forward-looking statements are based on the current expectations, estimates, assumptions or projections of management and are not guarantees of future performance. These expectations, estimates, assumptions or projections may vary materially from actual results. Accordingly, any such statements are qualified in their entirety by reference to, and are accompanied by, the following important factors that could cause our actual results to differ materially from those contained in our forward-looking statements, including, but not limited to:

~~cyber~~•cyberattacks or breaches, ~~acts~~including those resulting in the compromise of ~~war or terrorism, or grid disturbances,~~the confidentiality of our proprietary information and the personal information of our customers,

~~actions or inaction of local, state and federal regulatory, public policy and taxing bodies,~~

~~changes in business conditions, which could include disruptive technology related to our current or future business model,~~

~~changes in economic conditions, including impact on interest rates, tax policies, and customer demand and payment ability,~~

~~fluctuations in weather patterns,~~

~~changes in laws, regulations or regulatory policy,~~

~~changes in levels or timing of capital expenditures,~~

• disruptions in the capital markets or other events that make our access to necessary capital more difficult or costly,

~~developments~~• the negative impacts of the novel coronavirus (COVID-19) pandemic, including any new or emerging variants, on our customers, vendors, employees, regulators, and operations,

• changes in ~~legal~~economic conditions, including impact on interest rates, tax policies, and customer demand and payment ability,

• ability or inability to commence and complete our major strategic development projects and opportunities,

• acts of war or terrorism, physical attacks or grid disturbances that may damage and disrupt our electric transmission and electric, natural gas, and water distribution systems,

• actions or inaction of local, state and federal regulatory, public policy ~~doctrines,~~and taxing bodies,

~~technological developments,~~• substandard performance of third-party suppliers and service providers,

• fluctuations in weather patterns, including extreme weather due to climate change,

• changes in business conditions, which could include disruptive technology or development of alternative energy sources related to our current or future business model,

• contamination of, or disruption in, our water supplies,

• changes in levels or timing of capital expenditures,

• changes in laws, regulations or regulatory policy, including compliance with environmental laws and regulations,

• changes in accounting standards and financial reporting regulations,

• actions of rating agencies, and

• other presently unknown or unforeseen factors.

Other risk factors are detailed in our reports filed with the SEC and updated as necessary, and we encourage you to consult such disclosures.

All such factors are difficult to predict and contain uncertainties that may materially affect our actual results, many of which are beyond our control. You should not place undue reliance on the forward-looking statements, as each speaks only as of the date on which such statement is made, and, except as required by federal securities laws, we undertake no obligation to update any forward-looking statement or statements to reflect events or circumstances after the date on which such statement is made or to reflect the occurrence of unanticipated events. New factors emerge from time to time and it is not possible for us to predict all of such factors, nor can we assess the impact of each such factor on the business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements. For more information, see Item 1A, Risk Factors, included in this combined Quarterly Report on Form 10-Q and in Eversource's ~~2016~~2020 combined Annual Report on Form 10-K. This combined Quarterly Report on Form 10-Q and Eversource's ~~2016~~2020 combined Annual Report on Form 10-K also describe material contingencies and critical accounting policies in the accompanying Management's Discussion and Analysis of Financial Condition and Results of Operations and Combined Notes to Financial Statements. We encourage you to review these items.

Financial Condition and Business Analysis

Executive Summary

Eversource Energy is a public utility holding company primarily engaged, through its wholly-owned regulated utility subsidiaries, in the energy delivery business. Eversource Energy's wholly-owned regulated utility subsidiaries consist of CL&P, NSTAR Electric and PSNH (electric utilities), Yankee Gas, NSTAR Gas and Eversource Gas Company of Massachusetts (EGMA) (natural gas utilities) and Aquarion (water utilities). Eversource is organized into the electric distribution, electric transmission, natural gas distribution and water distribution reportable segments.

The following items in this executive summary are explained in more detail in this combined Quarterly Report on Form 10-Q:

~~Results:~~Earnings Overview and Future Outlook:

•We earned ~~$260.4~~$283.2 million, or $0.82 per share, in the third quarter of ~~2017,~~2021, and ~~$750.6~~$913.8 million, or ~~$2.36~~$2.65 per share, in the first nine months of ~~2017,~~2021, compared with ~~$265.3~~$346.3 million, or ~~$0.83~~$1.01 per share, in the third quarter of ~~2016,~~2020, and ~~$713.1~~$933.2 million, or ~~$2.24~~$2.76 per share, in the first nine months of ~~2016.~~ 2020.

•Our third quarter and first nine months of 2021 results include after-tax costs resulting from a CL&P settlement agreement on October 1, 2021 recorded within the electric distribution segment. Our first nine months of 2021 results also include an after-tax charge at CL&P recorded within the electric distribution segment ~~which includes generation, earned $157.4~~for a PURA assessment as a result of CL&P’s preparation for and response to Tropical Storm Isaias in August 2020. Our third quarter and first nine months of 2021 and 2020 results also include after-tax transition and acquisition costs recorded at Eversource parent. In total, these after-tax costs were $67.5 million, or ~~$0.50~~$0.20 per share, in the third quarter of ~~2017,~~2021, and ~~$393.4~~$103.1 million, or ~~$1.24~~$0.30 per share, in the first nine months of ~~2017, compared with $170.1~~2021. Our 2020 results include after-tax transition and acquisition costs recorded at Eversource parent of $5.3 million, or ~~$0.53~~$0.01 per share, in the third quarter of ~~2016,~~2020, and ~~$381.3~~$12.8 million, or ~~$1.20~~$0.04 per share, in the first nine months of ~~2016.~~

~~Our electric transmission segment earned $99.0~~2020. Excluding those costs, our non-GAAP earnings were $350.7 million, or ~~$0.31~~$1.02 per share, in the third quarter of ~~2017,~~2021, and ~~$289.6 million,~~$1.02 billion, or ~~$0.91~~$2.95 per share, in the first nine months of ~~2017,~~2021, compared with ~~$88.4~~$351.6 million, or ~~$0.28~~$1.02 per share, in the third quarter of ~~2016,~~2020, and ~~$266.6~~$946.0 million, or ~~$0.84~~$2.80 per share, in the first nine months of ~~2016.~~ 2020.

~~Our natural gas distribution segment had a net loss~~•We reaffirmed our projection of ~~$6.2 million, or $0.02~~our long-term EPS growth rate through 2025 from our regulated utility businesses in the upper half of the 5 to 7 percent range. We estimate to earn within the 2021 non-GAAP earnings guidance range of between $3.81 per share ~~in the third quarter of 2017,~~ and ~~earnings of $49.1 million, or $0.15~~$3.93 per share, inwhich excludes the ~~first nine months~~charges associated with the CL&P settlement agreement and the penalty for CL&P’s Tropical Storm Isaias response assessed by PURA, as well as transition costs related to our October 2020 purchase of ~~2017, compared with a net loss~~the assets of ~~$7.0 million, or $0.02 per share, in the third quarter of 2016,~~CMA and ~~earnings of $51.9 million, or $0.16 per share, in the first nine months of 2016.~~ acquisition costs.

Eversource parent and other companies earned $10.2 million in the third quarter of 2017 and $18.5 million in the first nine months of 2017, compared with $13.8 million in the third quarter of 2016 and $13.3 million in the first nine months of 2016.

Liquidity:

•Cash flows provided by operating activities totaled ~~$1.49~~$1.52 billion in the first nine months of ~~2017,~~2021, compared with ~~$1.65~~$1.50 billion in the first nine months of ~~2016.~~2020. Investments in property, plant and equipment totaled ~~$1.64~~$2.21 billion in the first nine months of ~~2017,~~2021, compared with ~~$1.36~~$2.10 billion in the first nine months of ~~2016.~~2020. Cash ~~and cash equivalents~~ totaled ~~$125.8~~$88.2 million as of September 30, ~~2017,~~2021, compared with ~~$30.3~~$106.6 million as of December 31, ~~2016.~~2020. Our available borrowing capacity under our commercial paper programs totaled $1.86 billion as of September 30, 2021.

•In ~~2017,~~the first nine months of 2021, we issued ~~$2.5~~$3.15 billion of new long-term debt, consisting of ~~$1.2~~$1.00 billion byat Eversource parent, ~~$700~~$425 million byat CL&P, $600 million at NSTAR Electric, ~~$525~~$350 million ~~by CL&P,~~at PSNH, $125 million at Yankee Gas, $550 million at EGMA, and ~~$75~~$100 million ~~by Yankee Gas. Proceeds from these new issuances were used primarily to pay short-term borrowings and redeem~~at Aquarion Water Company of Connecticut. In the first nine months of 2021, we repaid $1.14 billion of long-term debt, consisting of $450 million at ~~maturity.~~Eversource parent, $120.5 million at CL&P, $250 million at NSTAR Electric, $282 million at PSNH, and $40 million at Aquarion Water Company of Connecticut.

•On September ~~6, 2017,~~1, 2021, our Board of Trustees approved a common share dividend payment of ~~$0.475~~$0.6025 per share, ~~which was~~ paid on September ~~29, 2017~~30, 2021 to shareholders of record as of September ~~19, 2017.~~16, 2021.

~~Strategic, Legislative,~~ Regulatory ~~Policy~~ and ~~Other~~Strategic Items:

•On October 6, 2017, the FERC issued an order that did not accept the NETOs June 5, 2017 filing to reinstate the base ROE of 11.14 percent with an associated ROE incentive cap of 13.5 percent. Therefore, the Company will continue to recognize transmission revenues as billed utilizing1, 2021, CL&P entered into a ~~base ROE of 10.57 percent with an incentive cap of 11.74 percent.~~

~~On October 12, 2017, PSNH filed an application~~settlement agreement with the ~~NHPUC requesting approval~~DEEP, Office of Consumer Counsel (OCC), Office of the ~~sale~~Attorney General (AG) and the Connecticut Industrial Energy Consumers, resolving certain issues that arose in pending regulatory proceedings initiated by the PURA. PURA approved the settlement agreement on October 27, 2021. In the settlement agreement, CL&P agreed to provide a total of ~~PSNH's thermal~~$65 million of customer credits to be distributed based on customer sales over a two-month period from December 1, 2021 to January 31, 2022. CL&P also agreed to irrevocably set aside $10 million to fund various customer assistance initiatives as directed by PURA. In the third quarter of 2021, CL&P recorded a liability of $75 million associated with the provisions of the settlement agreement, with a $65 million pre-tax charge as a reduction to Operating Revenues associated with the customer credits and ~~hydroelectric power generation assets in New Hampshire~~a $10 million charge to ~~private investors~~Operations and Maintenance expense associated with the customer assistance initiatives onthe three months ended September 30, 2021 income statement. In exchange for ~~a combined purchase price totaling $258 million.~~

~~On October 29, 2017, a storm delivered high winds~~the $75 million of customer credits and ~~rain, causing extensive damage to our electric distribution systems across all three states. We estimate that more than 800,000 of our electric distribution customers were~~assistance, PURA’s interim rate reduction docket was resolved without ~~power during or following the storm. Restoration costs cannot be estimated at this time.~~findings. As a result of the ~~extent~~settlement agreement, neither the 90 basis point reduction to CL&P’s return on equity introduced in PURA’s storm-related decision issued April 28, 2021, nor the 45 basis point reduction to CL&P’s return on equity included in PURA’s draft decision issued September 14, 2021 in the interim rate reduction docket, will be implemented. Additionally, CL&P agreed to withdraw its pending appeals related to the storm performance penalty imposed in PURA’s April 28, 2021 and July 14, 2021 decisions. CL&P has also agreed to freeze its current base distribution rates until no earlier than January 1, 2024. The cumulative pre-tax impact of the ~~damages, we expect~~October 1, 2021 settlement agreement and the ~~storm restoration costs will be material~~Storm Isaias assessment imposed in PURA’s April 28, 2021 and ~~will exceed~~July 14, 2021 decisions totaled $103.6 million, and the ~~criteria~~after-tax earnings impact was $85.8 million, or $0.25 per share, for the nine months ended September 30, 2021.

•In August of 2021, BOEM released its Final Environmental Impact Statement (EIS) for the South Fork Wind project, which assessed the environmental, social, and economic impacts of constructing the project. In August of 2021, Sunrise Wind received BOEM’s Notice of Intent (NOI) to ~~be declared a major storm in Connecticut, New Hampshire, and Massachusetts and, as a result, we do not expect~~prepare an EIS for the ~~storm to have a material impact on our results~~review of ~~operations.~~the Construction Operations Plan (COP) application submitted by Sunrise Wind.

Earnings Overview

Consolidated: Below is a summary of our earnings by business, which also reconciles the non-GAAP financial ~~measure~~measures of consolidated non-GAAP earnings and EPS, as well as EPS by business, to the most directly comparable GAAP ~~measure~~measures of consolidated Net Income Attributable to Common Shareholders and diluted EPS.


	For the Three Months Ended September 30,								For the Nine Months Ended September 30,
	2021				2020				2021				2020
(Millions of Dollars, Except Per Share Amounts)	Amount		Per Share		Amount		Per Share		Amount		Per Share		Amount		Per Share
Net Income Attributable to Common Shareholders (GAAP)	$	283.2	$	0.82	$	346.3	$	1.01	$	913.8	$	2.65	$	933.2	$	2.76

Regulated Companies (non-GAAP) (1)	$	348.5	$	1.01	$	338.8	$	0.99	$	1,023.2	$	2.97	$	941.3	$	2.79
Eversource Parent and Other Companies (non-GAAP) (1)	2.2		0.01		12.8		0.03		(6.3)		(0.02)		4.7		0.01
Non-GAAP Earnings	$	350.7	$	1.02	$	351.6	$	1.02	$	1,016.9	$	2.95	$	946.0	$	2.80
CL&P Settlement Impacts (after-tax) (2)	(63.2)		(0.19)		—		—		(85.8)		(0.25)		—		—
Transition and Acquisition Costs (after-tax) (3)	(4.3)		(0.01)		(5.3)		(0.01)		(17.3)		(0.05)		(12.8)		(0.04)
Net Income Attributable to Common Shareholders (GAAP)	$	283.2	$	0.82	$	346.3	$	1.01	$	913.8	$	2.65	$	933.2	$	2.76

(1) The 2020 amounts were revised to conform to the current period segment presentation.

(2) The 2021 after-tax costs are associated with the CL&P settlement agreement on October 1, 2021, which included a pre-tax $65 million charge to earnings for customer credits and a $10 million charge to earnings to fund various customer assistance initiatives recorded in the third quarter of 2021. The nine months ended 2021 after-tax costs also include charges recorded at CL&P as a result of the April 28, 2021 and July 14, 2021 PURA decisions, which included a $28.4 million civil penalty for non-compliance with storm performance standards currently being provided as credits to customer bills and a $0.2 million fine to the State of Connecticut’s general fund. As a result of the October 1, 2021 settlement agreement, CL&P agreed to withdraw its pending appeals related to the storm performance penalty imposed in PURA’s April 28, 2021 and July 14, 2021 decisions. Management views these collective charges as not directly related to the ongoing operations of the business and therefore not an indicator of baseline operating performance.

(3) The 2020 acquisition costs are associated with our purchase of the assets of CMA on October 9, 2020. The 2021 costs are for the transition of systems as a result of the CMA acquisition and costs associated with our pending water business acquisition.

Regulated Companies: Our regulated companies comprise the electric distribution, electric transmission, natural gas distribution and water distribution segments. A summary of our segment earnings and EPS is as follows:


	For the Three Months Ended September 30,								For the Nine Months Ended September 30,
	2021				2020				2021				2020
(Millions of Dollars, Except Per Share Amounts)	Amount		Per Share		Amount		Per Share		Amount		Per Share		Amount		Per Share
Net Income - Regulated Companies (GAAP)	$	285.3	$	0.82	$	338.8	$	0.99	$	937.4	$	2.72	$	941.3	$	2.79

Electric Distribution (non-GAAP)	$	213.6	$	0.62	$	205.5	$	0.60	$	451.2	$	1.31	$	450.6	$	1.33
Electric Transmission	139.4		0.40		125.6		0.36		412.4		1.20		381.8		1.13
Natural Gas Distribution (1)	(22.0)		(0.06)		(15.4)		(0.04)		129.6		0.37		73.3		0.22
Water Distribution	17.5		0.05		23.1		0.07		30.0		0.09		35.6		0.11
Net Income - Regulated Companies (Non-GAAP)	$	348.5	$	1.01	$	338.8	$	0.99	$	1,023.2	$	2.97	$	941.3	$	2.79
CL&P Settlement Impacts (after-tax)	(63.2)		(0.19)		—		—		(85.8)		(0.25)		—		—
Net Income - Regulated Companies (GAAP)	$	285.3	$	0.82	$	338.8	$	0.99	$	937.4	$	2.72	$	941.3	$	2.79

(1) The 2020 amounts were revised to conform to the current period segment presentation.

Our electric distribution segment earnings decreased $55.1 million in the third quarter of 2021, as compared to the third quarter of 2020, due primarily to CL&P’s settlement agreement on October 1, 2021, which included a pre-tax $65 million charge to earnings for customer credits and a $10 million charge to earnings to fund various customer assistance initiatives recorded in the third quarter of 2021. The after-tax impact of the CL&P settlement agreement was $63.2 million, or $0.19 per share. Excluding those charges, electric distribution segment earnings increased $8.1 million due primarily to base distribution rate increases at NSTAR Electric effective January 1, 2021 and at PSNH effective January 1, 2021 and August 1, 2021, and higher earnings from CL&P's capital tracker mechanism due to increased electric system improvements. The earnings increase was partially offset by higher operations and maintenance expense, higher depreciation expense, higher interest expense, and higher property tax expense.

Our electric distribution segment earnings decreased $85.2 million in the first nine months of 2021, as compared to the first nine months of 2020, due primarily to CL&P’s settlement agreement on October 1, 2021 resulting in a total $75 million pre-tax charge to earnings and a $28.6 million pre-tax charge at CL&P for an assessment by PURA as a result of CL&P’s preparation for and response to Tropical Storm Isaias in August 2020 recorded in the first quarter of 2021. The after-tax impact of the CL&P settlement agreement and CL&P storm performance assessment imposed by PURA was $85.8 million, or $0.25 per share. For further information, see "Regulatory Developments and Rate Matters - Connecticut" included in this Management’s Discussion and Analysis. Excluding those charges, electric distribution segment earnings increased $0.6 million due primarily to base distribution rate increases at NSTAR Electric effective January 1, 2021, at PSNH effective January 1, 2021 and August 1, 2021, and at CL&P effective May 1, 2020, and higher earnings from CL&P's capital tracker mechanism due to increased electric system improvements. Those earnings increases were partially offset by higher operations and maintenance expense driven by higher employee-related expenses and higher storm restoration costs, higher depreciation expense, higher property tax expense, and higher interest expense.

Our electric transmission segment earnings increased $13.8 million and $30.6 million in the third quarter and the first nine months of ~~2017 and 2016.~~

For the Three Months Ended September 30, For the Nine Months Ended September 30,
2017 2016 2017 2016
(Millions of Dollars, Except Per-Share Amounts) Amount Per Share Amount Per Share Amount Per Share Amount Per Share
Net Income Attributable to
Common Shareholders (GAAP)
$ 260.4
$ 0.82
$ 265.3
$ 0.83
$ 750.6
$ 2.36
$ 713.1
$ 2.24
Regulated Companies $ 250.2
$ 0.79
$ 251.5
$ 0.79
$ 732.1
$ 2.30
$ 699.8
$ 2.20
Eversource Parent and Other Companies 10.2
0.03
13.8
0.04
18.5
0.06
13.3
0.04
Net Income Attributable to Common Shareholders (GAAP) $ 260.4
$ 0.82
$ 265.3

$ 0.83
$ 750.6
$ 2.36
$ 713.1
$ 2.24

~~Regulated Companies:~~ Our Regulated companies consist of the electric distribution, electric transmission, and natural gas distribution segments. Generation activities of PSNH and WMECO are included in our electric distribution segment. A summary of our segment earnings and EPS for2021, respectively, as compared to the third quarter and the first nine months of ~~2017 and 2016 is as follows:~~

For the Three Months Ended September 30, For the Nine Months Ended September 30,
2017 2016 2017 2016
(Millions of Dollars, Except Per-Share Amounts) Amount Per Share Amount Per Share Amount Per Share Amount Per Share
Electric Distribution $ 157.4
$ 0.50
$ 170.1
$ 0.53
$ 393.4
$ 1.24
$ 381.3
$ 1.20
Electric Transmission 99.0
0.31
88.4
0.28
289.6
0.91
266.6
0.84
Natural Gas Distribution (6.2 ) (0.02 ) (7.0 ) (0.02 ) 49.1
0.15
51.9
0.16
Net Income - Regulated Companies $ 250.2
$ 0.79
$ 251.5
$ 0.79
$ 732.1
$ 2.30
$ 699.8
$ 2.20

Our electric distribution segment earnings decreased $12.7 million in the third quarter of 2017, as compared to the third quarter of 2016, due primarily to lower sales volumes and demand revenues driven by the mild summer weather during the third quarter of 2017, primarily at NSTAR Electric, as well as higher property tax, depreciation and interest expense.

Our electric distribution segment earnings increased $12.1 million in the first nine months of 2017, as compared to the first nine months of 2016, due primarily to lower operations and maintenance expense, partially offset by lower sales volumes driven by the mild summer weather during the third quarter of 2017, primarily at NSTAR Electric, higher depreciation and interest expense, and lower generation earnings.

Our electric transmission segment earnings increased $10.6 million and $23.0 million in the third quarter and first nine months of 2017, respectively, as compared to the third quarter and first nine months of 2016,2020, due primarily to a higher transmission rate base as a result of our continued investment in our transmission ~~infrastructure,~~infrastructure. The earnings increase for the nine-month period was partially offset by a lower benefit ~~in the second quarter of 2017 related to~~from the annual billing and cost reconciliation filing with ~~the~~ FERC.

Our natural gas distribution segment ~~results improved $0.8~~had an increased loss of $6.6 million in the third quarter of ~~2017,~~2021, as compared to the third quarter of ~~2016, and~~2020, due primarily to a loss from the addition of Eversource Gas Company of Massachusetts (EGMA) operations of $8.4 million due to the seasonality of the natural gas business. The increased loss was partially offset by the base distribution rate increase at Yankee Gas effective January 1, 2021 (with changes to customer rates beginning March 1, 2021).

Our natural gas distribution segment earnings ~~decreased $2.8~~increased $56.3 million in the first nine months of ~~2017,~~2021, as compared to the first nine months of ~~2016. The decrease in~~2020, due primarily to the ~~first nine months~~addition of ~~2017~~EGMA earnings of $33.2 million. Additionally, the earnings increase was due ~~primarily~~ to base distribution rate increases at NSTAR Gas effective November 1, 2020 and at Yankee Gas effective January 1, 2021 (with changes to customer rates beginning March 1, 2021), and higher earnings from capital tracker mechanisms due to continued investments in natural gas infrastructure. The earnings increase was partially offset by higher depreciation expense, higher operations and maintenance expense, and ~~lower demand revenues in Connecticut driven by lower peak usage in 2017, as compared to 2016, as a result of milder winter weather.~~higher property tax expense.

~~Eversource Parent and Other Companies:~~ ~~Eversource parent and other companies earned $10.2~~Our water distribution segment earnings decreased $5.6 million in the third quarter of 2017 and $18.5 million in the first nine months of 2017, compared with $13.8 million in the third quarter of 2016 and $13.3 million in the first nine months of 2016. The improved year-to-date results were largely due to increased gains on investments recorded in 2017, partially offset by higher interest expense.

~~Electric and Natural Gas Sales Volumes:~~ Weather, fluctuations in energy supply costs, conservation measures (including utility-sponsored energy efficiency programs), and economic conditions affect customer energy usage. Industrial sales volumes are less sensitive to temperature variations than residential and commercial sales volumes. In our service territories, weather impacts electric sales volumes during the summer and both electric and natural gas sales volumes during the winter; however, natural gas sales volumes are more sensitive to temperature variations than are electric sales volumes. Customer heating or cooling usage may not directly correlate with historical levels or with the level of degree-days that occur.

Fluctuations in retail electric sales volumes at NSTAR Electric and PSNH impact earnings ("Traditional" in the table below). For CL&P and WMECO, fluctuations in retail electric sales volumes do not impact earnings due to their respective regulatory commission approved distribution revenue decoupling mechanisms ("Decoupled" in the table below). These distribution revenues are decoupled from their customer sales volumes, which breaks the relationship between sales volumes and revenues recognized. CL&P and WMECO reconcile their annual base distribution rate recovery amounts to their respective pre-established levels of baseline distribution delivery service revenues of $1.059 billion and $132.4 million, respectively. Any difference between the allowed level of distribution revenue and the actual amount incurred during a 12-month period is adjusted through rates in the following period.

Fluctuations in natural gas sales volumes in Connecticut impact earnings ("Traditional" in the table below). In Massachusetts, fluctuations in natural gas sales volumes do not impact earnings due to the DPU-approved natural gas distribution revenue decoupling mechanism approved in the last rate case decision ("Decoupled" in the table below). These distribution revenues are decoupled from their customer sales volumes, which breaks the relationship between sales volumes and revenues recognized.

~~A summary of our retail electric GWh sales volumes and our firm natural gas MMcf sales volumes, as well as percentage changes, is as follows:~~

For the Three Months Ended September 30, 2017 Compared to 2016 For the Nine Months Ended September 30, 2017 Compared to 2016
Sales Volumes (GWh) Percentage Sales Volumes (GWh) Percentage
Electric 2017 2016 Decrease 2017 2016 Decrease
Traditional:
Residential 2,583
2,910
(11.2 )% 7,126
7,407
(3.8 )%
Commercial 4,291
4,525
(5.2 )% 12,058
12,376
(2.6 )%
Industrial 671
696
(3.6 )% 1,856
1,948
(4.7 )%
Total – Traditional 7,545
8,131
(7.2 )% 21,040
21,731
(3.2 )%

Decoupled:
Residential 2,972
3,398
(12.5 )% 8,334
8,750
(4.8 )%
Commercial 2,849
3,039
(6.3 )% 8,003
8,315
(3.8 )%
Industrial 730
776
(5.9 )% 2,054
2,170
(5.3 )%
Total – Decoupled 6,551
7,213
(9.2 )% 18,391
19,235
(4.4 )%
Total Sales Volumes 14,096
15,344
(8.1 )% 39,431
40,966
(3.7 )%

For the Three Months Ended September 30, 2017 Compared to 2016 For the Nine Months Ended September 30, 2017 Compared to 2016
Sales Volumes (MMcf) Percentage Sales Volumes (MMcf) Percentage
Firm Natural Gas 2017 2016 Increase/(Decrease) 2017 2016 Increase/(Decrease)
Traditional:
Residential 1,036
956
8.4 % 10,138
10,109
0.3 %
Commercial 2,482
2,350
5.6 % 14,432
13,864
4.1 %
Industrial 2,032
1,964
3.5 % 7,663
7,597
0.9 %
Total – Traditional 5,550
5,270
5.3 % 32,233
31,570
2.1 %

Decoupled:
Residential 1,244
1,308
(4.9 )% 14,593
13,848
5.4 %
Commercial 2,314
2,147
7.8 % 15,072
15,019
0.4 %
Industrial 1,270
990
28.3 % 4,293
4,163
3.1 %
Total – Decoupled 4,828
4,445
8.6 % 33,958
33,030
2.8 %
Special Contracts ⁽¹⁾
1,147
1,208
(5.0 )% 3,495
3,507
(0.3 )%
Total – Decoupled and Special Contracts 5,975
5,653
5.7 % 37,453
36,537
2.5 %
Total Sales Volumes 11,525
10,923
5.5 % 69,686
68,107
2.3 %


⁽¹⁾	Special contracts are unique to the 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.

~~For~~ the third quarter and the first nine months of ~~2017, retail electric sales volumes at our electric utilities with a traditional rate structure (NSTAR Electric and PSNH) were lower,~~2021, as compared to the third quarter and first nine months of 2016. Sales volumes were negatively impacted by the mild summer weather in the third quarter of 2017, as compared to the same period in 2016, and lower customer usage driven by the impact of increased customer energy conservation efforts. Cooling degree days for the first nine months of ~~2017 were 17.8 percent lower~~2020. The earnings decrease in ~~the Boston metropolitan area and 24.8 percent lower in New Hampshire, as compared~~both periods was due primarily to the ~~same period~~absence in ~~2016.~~

~~On January 28, 2016, Eversource received approval~~2021 of a ~~three-year energy efficiency plan in Massachusetts, which includes recovery~~third quarter 2020 after-tax gain of ~~LBR at NSTAR Electric until it is operating under a decoupled rate structure. NSTAR Electric earns LBR related to reductions in sales volume~~$3.5 million and lower revenues as a result of ~~successful energy efficiency programs. LBR is recovered from retail customers through current rates. NSTAR Electric recognized LBR~~the sale of ~~$18.8~~the water system and treatment plant in Hingham, Massachusetts.

Eversource Parent and Other Companies: Eversource parent and other companies had increased losses of $9.6 million and ~~$54.7~~$15.5 million in the third quarter and the first nine months of ~~2017,~~2021, respectively, as compared to ~~$17.4 million and $44.1 million in~~ the third quarter and the first nine months of ~~2016, respectively.~~2020, due primarily to a higher effective tax rate. The increased loss for the nine-month period was also due to an increase in the transition and integration costs of EGMA of $4.5 million.

~~Our firm natural gas sales volumes are subject~~

Impact of COVID-19

COVID-19 has adversely affected customers, workers and the U.S. economy. We provide a critical service to ~~many~~our customers and have taken extensive measures to maintain its safety and reliability. We continue to address the impacts of the ~~same influences as our retail electric sales volumes. In addition, they have benefited from customer growth~~COVID-19 pandemic and how the related developments affect Eversource. We are in ~~both~~the re-entry phase of our ~~natural gas distribution companies. Consolidated firm natural gas sales volumes were higher~~pandemic response plan, in which the majority of our employees under remote work arrangements have transitioned back to the workplace. We have not experienced significant impacts directly related to the pandemic that have materially affected our current operations, our workforce, or results of operations. The extent of the impact to us in the future will vary, and depend on the duration, scope and severity of the pandemic and the resulting impact on economic, health care and capital market conditions. The future impact will also depend on the outcome of future proceedings before our state regulatory commissions to recover our incremental costs associated with COVID-19, which include uncollectible customer receivable expenses.

The current and expected future financial impacts of COVID-19 as it relates to our businesses primarily relate to collectability of customer receivables and customer payment plans and increased expenses for cleaning and supplies for personal protective equipment.

As of September 30, 2021, our allowance for uncollectible customer receivable balance of $441.7 million, of which $229.9 million relates to hardship accounts that are specifically recovered in rates charged to customers, adequately reflected the collection risk and net realizable value for our receivables. We continue to evaluate the adequacy of the uncollectible allowance based on an ongoing assessment of accounts receivable collections and customer payment trends, economic conditions, delinquency statistics, aging-based quantitative assessments, the impact on residential customer bills because of energy usage and change in rates, flexible payment plans and financial hardship arrearage management programs being offered to customers, and COVID-19 developments, including any potential federal governmental pandemic relief programs and the expansion of unemployment benefit initiatives, which help to mitigate the potential for increasing customer account delinquencies. Additionally, management considered past economic declines and corresponding uncollectible reserves as part of the current assessment.

This evaluation has shown that our operating companies have experienced an increase in aged receivables and lower cash collections from customers because of the length of the moratorium on disconnections in Connecticut and Massachusetts, and the economic slowdown resulting from the COVID-19 pandemic. In Connecticut, the moratorium on disconnections of commercial and non-hardship residential customers ended in June 2021 and September 2021, respectively, but is still in place for hardship residential customers. In Massachusetts, the moratorium on disconnections of commercial customers and residential customers ended in September 2020 and July 2021, respectively. Disconnection activities have resumed after these moratoria have expired, which has resulted in recent improved collection experience and more customers applying for, and receiving, hardship status. On July 7, 2021, the NHPUC issued an order to New Hampshire utilities that concluded that recovery of incremental bad debt or waived late fees related to the COVID-19 pandemic would be addressed in a future rate case to the extent those costs are relevant at that time. As a result of the order, in the first nine months of ~~2017, as compared to~~2021, PSNH removed its $0.6 million deferral of net incremental COVID-19 costs. In New Hampshire, the moratorium on disconnections of non-hardship residential and commercial customers ended in late 2020 and for hardship residential customers ended in May 2021 and PSNH has resumed disconnection activities, which has resulted in improved collection of outstanding customer receivable balances.

Based upon the evaluation performed, in the first nine months of ~~2016, due primarily to improved economic conditions across~~2021, management increased the allowance for uncollectible accounts for amounts incurred as a result of COVID-19 by $25.8 million for Eversource (increase of $16.3 million for CL&P and $12.5 million at our ~~service territories, partially offset by increased customer energy conservation efforts. The first~~natural gas businesses, and decrease of $1.8 million at NSTAR Electric). In the third quarter of ~~2017 mild winter weather was more than offset~~2021, the COVID-19 related allowance for uncollectible accounts decreased by ~~colder than normal weather~~$6.5 million at Eversource (increased $4.0 million at CL&P, and decreased $8.3 million at NSTAR Electric and $2.2 million at our natural gas businesses). The COVID-19 related uncollectible amounts were deferred either as incremental regulatory costs at our Connecticut and Massachusetts utilities or deferred through existing regulatory tracking mechanisms that recover uncollectible energy supply costs, as management believes it is probable that these costs will ultimately be recovered from customers in future rates. As of September 30, 2021, the total amount incurred as a result of COVID-19 included in the ~~second quarter~~allowance for uncollectible accounts was $57.0 million at Eversource ($20.1 million at CL&P, $8.5 million at NSTAR Electric, and $27.4 million at our natural gas businesses). Based on the status of ~~2017. Heating degree days~~our COVID-19 regulatory dockets, communications with our state regulatory commissions, and policies and practices in the jurisdictions in which we operate, we believe our state regulatory commissions in Connecticut and Massachusetts will allow us to recover our incremental costs associated with COVID-19, which include uncollectible customer receivable expenses, while balancing the impact on our customers’ bills and our operating cash flows.

We continue to work closely with our state regulatory commissions and consumer advocates on customer assistance measures, including payment plan options in order to mitigate the impact on customer rates in the future, as well as financial hardship and arrearage management programs for those customers who are unable to pay their utility bills. We developed these long-term solutions for customers in order to help minimize the extent of the impact of COVID-19 on customer receivable balances and customers’ affordability in light of the current financial impact they may experience.

In the first nine months of ~~2017 were 2.2 percent higher in Connecticut,~~2021, net incremental costs incurred as ~~compared to the same period in 2016.~~

~~Major Storm:~~ On October 29, 2017, a storm delivered high winds and rain, causing extensive damage to our electric distribution systems across all three states. We estimate that more than 800,000 of our electric distribution customers were without power during or following the storm. Restoration costs cannot be estimated at this time. As a result of COVID-19 totaled $21.2 million, and related to uncollectible expense that impacts earnings, facilities and fleet cleaning, sanitizing costs and supplies for personal protective equipment, net of cost savings and benefits under the ~~extent~~CARES Act. In the first nine months of ~~the damages,~~2021, we expect the storm restoration costs will be material and will exceed the criteria to be declared a major storm in Connecticut, New Hampshire, and Massachusetts and that each operating company will seek recoverydeferred $17.3 million of these net incremental COVID-19 costs ~~through its applicable regulatory recovery process.~~ on the balance sheet. Net incremental COVID-19 expenses that reduced pre-tax earnings totaled $3.9 million on the statement of income in the first nine months of 2021.

As of September 30, 2021, a ~~result, all qualifying expenses prudently incurred during~~total of $41.3 million of net deferred incremental COVID-19 costs were recorded on the ~~storm will be deferred~~balance sheet, of which $34.5 million of that deferral related to uncollectible expense that impacts earnings and ~~recovered from customers. We do not expect the storm~~$6.8 million related to ~~have a material impact to the results of operations of CL&P, NSTAR Electric, PSNH or WMECO.~~cleaning and supplies for personal protective equipment.

Liquidity

~~Consolidated:~~ Cash ~~and cash equivalents~~ totaled ~~$125.8~~$88.2 million as of September 30, ~~2017,~~2021, compared with ~~$30.3~~$106.6 million as of December 31, ~~2016.~~2020.

~~Long-Term~~Short-Term Debt ~~Issuances:~~ 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 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, will be used to redeem long-term debt due to mature on November 15, 2017.

~~Long-Term Debt Repayments:~~ ~~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.~~

~~In October 2017, NSTAR Gas repaid at maturity $25 million of 7.04 percent Series M First Mortgage Bonds.~~

- Commercial Paper Programs and Credit Agreements: Eversource parent has a ~~$1.45~~$2.00 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, EGMA and Aquarion Water Company of Connecticut are parties to a five-year ~~$1.45~~$2.00 billion revolving credit ~~facility. The revolving credit~~ facility, which terminates on ~~September 4, 2021. The~~October 15, 2026. This revolving credit facility serves to backstop Eversource parent's ~~$1.45~~$2.00 billion commercial paper program. ~~There were no borrowings outstanding on the revolving credit facility as of September 30, 2017 and December 31, 2016.~~

Except as described below, amounts outstanding under the commercial paper programs are included in Notes Payable for Eversource and are classified in current liabilities on the balance sheets as all borrowings are outstanding for no more than 364 days at one time.

The amount of borrowings outstanding and available under the commercial paper programs were as follows:


	Borrowings Outstanding as of				Available Borrowing Capacity as of				Weighted-Average Interest Rate as of
	September 30, 2021		December 31, 2020		September 30, 2021		December 31, 2020		September 30, 2021		December 31, 2020
(Millions of Dollars)
Eversource Parent Commercial Paper Program	$	653.0	$	1,054.3	$	1,347.0	$	945.7	0.18	%	0.25	%
NSTAR Electric Commercial Paper Program	138.0		195.0		512.0		455.0		0.10	%	0.16	%

There were no borrowings outstanding on the revolving credit ~~facility~~facilities as of September 30, ~~2017 and~~2021 or December 31, ~~2016.~~2020.

Amounts outstanding under the commercial paper programs are included in Notes Payable and classified in current liabilities on the Eversource and NSTAR Electric balance sheets, as all borrowings are outstanding for no more than 364 days at one time. As a result of the NSTAR Gas long-term debt issuances in October 2021, $80.0 million of commercial paper borrowings under the Eversource parent commercial paper program were classified as Long-Term Debt as of September 30, 2021.

Intercompany Borrowings: Eversource parent uses its available capital resources to provide loans to its subsidiaries to assist in meeting their short-term borrowing needs. Eversource parent records intercompany interest income from its loans to subsidiaries, which is eliminated in consolidation. Intercompany loans from Eversource parent to its subsidiaries are eliminated in consolidation on Eversource's balance sheets. As of September 30, 2021, there were intercompany loans from Eversource parent to PSNH of $66.5 million, and to a subsidiary of NSTAR Electric of $24.6 million. As of December 31, 2020, there were intercompany loans from Eversource parent to PSNH of $46.3 million, and to a subsidiary of NSTAR Electric of $21.3 million. Intercompany loans from Eversource parent are included in Notes Payable to Eversource Parent and classified in current liabilities on the respective subsidiary's balance sheets.

Availability under Long-Term Debt Issuance Authorizations: On March 31, 2021, the DPU approved NSTAR Electric's request for authorization to issue up to $1.60 billion in long-term debt through December 31, 2023. On September 10, 2021, the DPU approved EGMA’s request for authorization to issue up to $725 million in long-term debt through December 31, 2023. The remaining Eversource operating companies, including CL&P and PSNH, have utilized the long-term debt authorizations in place with the respective regulatory commissions.

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

(Millions of Dollars)

Issuance/(Repayment)

Issue Date or Repayment Date

Maturity Date

Use of Proceeds for Issuance/
Repayment Information

CL&P:

2.05% Series A First Mortgage Bonds

425.0

June 2021

July 2031

Repaid short-term debt, paid capital expenditures and working capital

4.38% Series A PCRB

(120.5)

September 2021

September 2028

Paid on par call date in advance of maturity

NSTAR Electric:

3.10% 2021 Debentures

300.0

May 2021

June 2051

Refinanced investments in eligible green

expenditures, which were previously financed in 2019 and 2020

3.50% Series F Senior Notes

(250.0)

June 2021

September 2021

Paid on par call date in advance of maturity date

1.95% 2021 Debentures

300.0

August 2021

August 2031

Repaid short-term debt, paid capital expenditures and working capital

PSNH:

4.05% Series Q First Mortgage Bonds

(122.0)

March 2021

June 2021

Paid on par call date in advance of maturity date

3.20% Series R First Mortgage Bonds

(160.0)

June 2021

September 2021

Paid on par call date in advance of maturity date

2.20% Series V First Mortgage Bonds

350.0

June 2021

June 2031

Repaid short-term debt, including short-term debt used to redeem Series R First Mortgage Bonds, paid capital expenditures and working capital

Other:

Eversource Parent 2.50% Series I Senior Notes

(450.0)

February 2021

March 2021

Paid on par call date in advance of maturity date

Eversource Parent 2.55% Series S Senior Notes

350.0

March 2021

March 2031

Repaid short-term debt, including short-term debt used to redeem Series I Senior Notes

Eversource Parent 1.40% Series U Senior Notes

300.0

August 2021

August 2026

Repaid short-term debt

Eversource Parent Variable Rate Series T Senior Notes (1)

350.0

August 2021

August 2023

Repaid short-term debt

Aquarion Water Company of Connecticut 3.31%

Senior Notes

100.0

April 2021

April 2051

Repaid 5.50% Notes, repaid short-term debt, paid capital expenditures and working capital

Aquarion Water Company of Connecticut 5.50% Notes

(40.0)

April 2021

Paid at maturity

Yankee Gas 1.38% Series S First Mortgage Bonds

90.0

August 2021

August 2026

(2)

Yankee Gas 2.88% Series T First Mortgage Bonds

35.0

August 2021

August 2051

(2)

EGMA 2.11% Series A First Mortgage Bonds

310.0

September 2021

October 2031

(2)

EGMA 2.92% Series B First Mortgage Bonds

240.0

September 2021

October 2051

(2)

NSTAR Gas 2.25% Series T First Mortgage Bonds

40.0

October 2021

November 2031

(2)

NSTAR Gas 3.03% Series U First Mortgage Bonds

40.0

October 2021

November 2051

(2)

Rate Reduction Bonds: PSNH's RRB payments consist of principal and interest and are paid semi-annually. PSNH paid $43.2 million of RRB principal payments and $18.9 million of interest payments in the first nine months of 2021, and paid $43.2 million of RRB principal payments and $20.2 million of interest payments in the first nine months of 2020.

Cash Flows: Cash flows provided by operating activities totaled ~~$1.49~~$1.52 billion in the first nine months of ~~2017,~~2021, compared with ~~$1.65~~$1.50 billion in the first nine months of ~~2016. The decrease in operating~~2020. Operating cash flows ~~was due primarily~~were favorably impacted by improvements in the timing of collections for regulatory tracking mechanisms, the addition of cash flows of EGMA, the timing of cash collections on our accounts receivable, and the timing of other working capital items. These favorable impacts were partially offset by the timing of cash payments made on our accounts payable, cash payments made in 2021 for storm restoration costs of approximately $52 million related to ~~the $200.7~~Tropical Storm Isaias at CL&P, a $39.5 million ~~net unfavorable impact as a result of the change~~increase in income tax payments made ~~or refunds received,~~ in ~~2017 when~~2021, as compared to ~~2016. This unfavorable impact was primarily the result of the December 2015 legislation, which extended the accelerated deduction of depreciation from 2015 to 2019. The legislation resulted in~~2020, a ~~significant refund of approximately $275~~$32.0 million ~~which we received in the first quarter of 2016. Additionally, there was an~~ increase ~~of $76.0 million~~ in Pension and PBOP ~~Plan cash~~ contributions made in ~~the first nine months of 2017,~~2021, as compared to ~~the same period~~2020, and an increase in ~~2016. Partially offsetting these unfavorable impacts was the benefit related to the timing~~cost of ~~regulatory recoveries and the timing of collections and payments of our working capital items, including accounts receivable and accounts payable.~~removal expenditures.

On September ~~6, 2017,~~1, 2021, our Board of Trustees approved a common share dividend payment of ~~$0.475~~$0.6025 per share, ~~which was~~ paid on September ~~29, 2017~~30, 2021 to shareholders of record as of September ~~19, 2017.~~16, 2021. In the first nine months of 2021, we paid cash dividends of $603.6 million and issued non-cash dividends of $17.3 million in the form of treasury shares, totaling dividends of $620.9 million. In the first nine months of 2020, we paid cash dividends of $555.7 million and issued non-cash dividends of $17.2 million in the form of treasury shares, totaling dividends of $572.9 million.

In the first nine months of ~~2017,~~2021, CL&P, NSTAR Electric and PSNH ~~and WMECO~~ paid ~~$205.2~~$210.3 million, ~~$186.0 million, $23.9~~$283.2 million, and ~~$28.5~~$235.6 million, respectively, in common stock dividends to Eversource parent.

Investments in Property, Plant and Equipment on the statements of cash flows do not include amounts incurred on capital projects but not yet paid, cost of removal, AFUDC related to equity funds, and the capitalized and deferred portions of pension and PBOP expense. In the first nine months of ~~2017,~~2021, investments for Eversource, CL&P, NSTAR Electric, and PSNH ~~and WMECO~~ were ~~$1.64~~$2.21 billion, ~~$621.9~~$563.2 million, ~~$358.0 million, $215.5~~$675.2 million, and ~~$109.2~~$217.4 million, respectively.

We expect the future operating cash flows of Eversource, CL&P, NSTAR Electric and PSNH, along with our existing borrowing availability and access to both debt and equity markets, will be sufficient to meet any working capital and future operating requirements, and capital investment forecasted opportunities.

Credit Ratings: On September 21, 2021, Fitch changed CL&P’s outlook from stable to negative. On October 29, 2021, S&P changed CL&P’s outlook from negative to stable.

Business Development and Capital Expenditures

~~Aquarion~~: On June 2, 2017, Eversource announced that it had entered into an agreement to acquire Aquarion from Macquarie Infrastructure Partners for $1.675 billion, consisting of approximately $880 million in cash and $795 million of assumed Aquarion debt. The transaction requires approval from PURA, the DPU, the NHPUC, the Maine PUC, and the Federal Communications Commission, and is also subject to a review under the Hart-Scott-Rodino Act. On June 29, 2017, Eversource and Aquarion filed joint applications with regulatory agencies in Connecticut, Massachusetts, New Hampshire and Maine requesting approval of the transaction. With the exception of Massachusetts, all state and federal regulatory agency approvals have been received and the related review period has expired. The transaction is expected to close by December 31, 2017.

~~Bay State Wind~~: Bay State Wind is a proposed offshore wind project being jointly developed by Eversource and Denmark-based Ørsted (formerly known as DONG Energy). Bay State Wind will be located in a 300-square-mile area approximately 15 to 25 miles south of Martha's Vineyard that has the ultimate potential to generate more than 2,000 MW of energy. Both Eversource and Ørsted hold a 50 percent ownership interest in Bay State Wind. In August 2016, Massachusetts passed clean energy legislation that requires EDCs to jointly solicit RFPs and enter into long-term contracts for offshore wind, creating RFP opportunities for projects like Bay State Wind. On June 29, 2017, the Bureau of Ocean Energy Management ("BOEM") approved the project’s Site Assessment Plan ("SAP"), the first BOEM approval of an offshore wind SAP in the U.S.

On June 29, 2017, the Massachusetts RFP was issued, seeking bids for a minimum of 400 MW of offshore wind capacity. The 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.

~~Consolidated Capital Expenditures:~~Our consolidated capital expenditures, including amounts incurred but not paid, cost of removal, AFUDC, and the capitalized and deferred portions of pension and PBOP expense (all of which are non-cash factors), totaled ~~$1.69~~$2.29 billion in the first nine months of ~~2017,~~2021, compared to ~~$1.43~~$2.19 billion in the first nine months of ~~2016.~~2020. These amounts included ~~$97.8~~$161.2 million and ~~$87.1~~$178.3 million in the first nine months of ~~2017~~2021 and ~~2016,~~2020, respectively, related to information technology and facilities upgrades and enhancements, primarily at Eversource Service and The Rocky River Realty Company.

Electric Transmission Business:

Our consolidated electric transmission business capital expenditures ~~increased~~decreased by ~~$40.9~~$22.6 million in the first nine months of ~~2017,~~2021, as compared to the first nine months of ~~2016.~~2020. A summary of electric transmission capital expenditures by company is as follows:


	For the Nine Months Ended September 30,
(Millions of Dollars)	2021		2020
CL&P	$	242.4	$	296.4
NSTAR Electric	316.1		253.6
PSNH	123.7		154.8
Total Electric Transmission Segment	$	682.2	$	704.8

For the Nine Months Ended September 30,
(Millions of Dollars) 2017 2016
CL&P $ 300.7
$ 211.8
NSTAR Electric 108.5
162.6
PSNH 87.4
80.2
WMECO 70.9
75.7
NPT 32.1
28.4
Total Electric Transmission Segment $ 599.6
$ 558.7

~~Northern Pass~~: Northern Pass is a planned HVDC transmission line from the Québec-New Hampshire border to Franklin, New Hampshire and an associated alternating current radial transmission line between Franklin and Deerfield, New Hampshire. Northern Pass will interconnect at the Québec-New Hampshire border with a planned HQ HVDC transmission line.

On April 13, 2017, the New Hampshire Site Evaluation Committee ("NH SEC") commenced final adjudicative hearings that, on August 31, 2017, were extended and will result in the issuance of a final order by March 31, 2018.

On August 10, 2017, the DOE issued the final Environmental Impact Statement for Northern Pass concluding that the proposed Northern Pass route is the preferred alternative, providing substantial benefits with only minimal impacts. Siting and permitting at both the state and federal levels is well advanced and the DOE is expected to issue the Presidential Permit for Northern Pass during the fourth quarter of 2017. Northern Pass is expected to be placed in service in the second half of 2020.

~~In August 2016,~~Eastern Massachusetts enacted clean energy legislation that requires EDCs to solicit proposals jointly and enter into long-term contracts for energy, such as hydropower. The RFP was issued on March 31, 2017 and on July 27, 2017, Eversource Energy Transmission Ventures, Inc. and HQ jointly submitted proposals for Northern Pass into the Massachusetts clean energy RFP.

~~Greater Boston Reliability Solution: In February 2015, ISO-NE selected the Greater Boston~~ and New Hampshire ~~Solution (the "Solution"), proposed by Eversource and National Grid, to satisfy the requirements identified in the Greater Boston study. The Solution consists~~Transmission Projects: These projects consist of a portfolio of electric transmission upgrades ~~covering~~in southern New Hampshire, ~~and~~ northern Massachusetts and continuing into the greater Boston metropolitan area, of which 28 upgrades are in Eversource's service ~~territory.~~territory (two in New Hampshire and 26 in Massachusetts). The ~~NH SEC issued its written order approving the~~two New Hampshire upgrades, ~~on October 4, 2016. We are currently pursuing~~including the ~~necessary regulatory~~Merrimack Valley Reliability Project, have been placed in service, and ~~siting application approvals~~23 Massachusetts upgrades have been placed in ~~Massachusetts. To date, we have received approval for two of these projects from~~service. On December 17, 2019, the Massachusetts ~~Energy Facilities~~ Siting ~~Board. Construction has also begun~~Board issued a favorable decision on ~~several smaller~~the Sudbury-Hudson Reliability Project, the last project requiring such approval. On January 17, 2020, the Town of Sudbury and Protect Sudbury, a community group, appealed the decision to the Massachusetts Supreme Judicial Court. On June 25, 2021, the Massachusetts Supreme Judicial Court rejected the Town’s appeal, affirming all aspects of the Siting Board’s final decision. On March 11, 2021, Protect Sudbury filed a petition with the Surface Transportation Board, a federal agency, claiming the Massachusetts Bay Transportation Authority (MBTA) did not have the right to lease a portion of its inactive railroad corridor, a claim previously rejected by the Massachusetts Land Court. MBTA filed its response on April 30, 2021 and a decision is anticipated by the end of the year. Additionally, Eversource must reach agreement on a Memorandum of Agreement (MOA) with the Army Corps of Engineers and consulting parties, including the Massachusetts Historical Commission and the Narragansett tribe, to establish measures to be performed by the Company to mitigate project impacts. The Army Corps of Engineers initiated the MOA consultation process with the consulting parties in late September. Although there is no mandated timeframe for resolution, the Company anticipates achieving resolution by the end of 2021. The two remaining upgrades, the Mystic-Woburn and the Wakefield-Woburn reliability projects, ~~not requiring siting approval. All upgrades~~are under construction and are expected to be ~~completed~~placed in service by the ~~end~~second quarter of ~~2019.~~2023. We estimate our portion of the investment ~~in the Solution~~ will be approximately ~~$560~~$750 million, of which, ~~$186.3~~$564 million has been spent and capitalized through September 30, ~~2017.~~2021.

~~GHCC: The Greater Hartford Central Connecticut ("GHCC")~~Southeastern Massachusetts Transmission Projects: These projects ~~which have been approved by ISO-NE,~~ consist of ~~27 projects~~a portfolio of electric transmission and substation upgrades in southeastern Massachusetts, including Cape Cod, required to reinforce the Southeastern Massachusetts transmission system and bring the system into compliance with ~~an expected investment~~applicable national and regional reliability standards. Of the twelve upgrades in Eversource’s service territory, four require siting approvals from the Massachusetts regulatory agencies, of ~~approximately $350 million that~~which, one has received approval and is under construction, two have completed hearings and are ~~expected~~awaiting orders and one, a joint project with National Grid, has yet to be ~~placed in service through 2019. Sixteen~~filed. Of the remaining eight projects, two projects are under construction, and six projects have been placed ~~in service, and eight projects are in active construction. As of September 30, 2017, CL&P had capitalized $192.3 million in costs associated with GHCC.~~

~~Seacoast Reliability Project~~: On April 12, 2016, PSNH filed a siting application with the NH SEC for the Seacoast Reliability Project, a 13-mile, 115kV transmission line within several New Hampshire communities, which proposes to use a combination of overhead, underground and underwater line design to help meet the growing demand for electricity in the Seacoast region. In June 2016, the NH SEC accepted our application as complete. Due to delays with the siting hearings, we now expect the NH SEC decision in mid-2018, and this project is now expected to be completed by the end of 2019.in-service. We estimate our portion of the investment ~~in this project to~~will be approximately ~~$84~~$190 million, of which, $42 million has been spent and capitalized through September 30, ~~2017, PSNH had capitalized $19.7 million in costs.~~2021.

All project costs are anticipated to be fully recoverable through transmission rates.

Distribution Business:

A summary of distribution capital expenditures is as follows:


	For the Nine Months Ended September 30,
(Millions of Dollars)	CL&P		NSTAR Electric		PSNH		Total Electric		Natural Gas		Water		Total
2021
Basic Business	$	160.2	$	111.7	$	39.5	$	311.4	$	140.8	$	11.0	$	463.2
Aging Infrastructure	110.5		162.7		44.3		317.5		358.3		77.7		753.5
Load Growth and Other	51.2		108.5		15.2		174.9		59.0		0.5		234.4
Total Distribution	321.9		382.9		99.0		803.8		558.1		89.2		1,451.1
Solar	—		(0.7)		—		(0.7)		—		—		(0.7)
Total	$	321.9	$	382.2	$	99.0	$	803.1	$	558.1	$	89.2	$	1,450.4
2020
Basic Business	$	149.4	$	146.5	$	38.9	$	334.8	$	59.7	$	7.6	$	402.1
Aging Infrastructure	133.2		178.8		58.7		370.7		268.0		82.5		721.2
Load Growth and Other	55.3		69.2		14.6		139.1		39.2		0.6		178.9
Total Distribution	337.9		394.5		112.2		844.6		366.9		90.7		1,302.2
Solar	—		1.1		—		1.1		—		—		1.1
Total	$	337.9	$	395.6	$	112.2	$	845.7	$	366.9	$	90.7	$	1,303.3

For the Nine Months Ended September 30,
(Millions of Dollars) CL&P NSTAR Electric PSNH WMECO Total Electric Natural Gas Total Electric and Natural Gas Distribution Segment
2017
Basic Business $ 161.8
$ 110.3
$ 52.5
$ 16.4
$ 341.0
$ 51.3
$ 392.3
Aging Infrastructure 127.4
49.6
63.9
16.3
257.2
149.6
406.8
Load Growth ⁽¹⁾
41.0
53.2
14.1
(1.5 ) 106.8
30.6
137.4
Total Distribution 330.2
213.1
130.5
31.2
705.0
231.5
936.5
Generation ⁽²⁾
—
24.6
6.7
20.9
52.2
—
52.2
Total Electric and Natural Gas Distribution Segment $ 330.2
$ 237.7
$ 137.2
$ 52.1
$ 757.2
$ 231.5
$ 988.7

2016
Basic Business $ 127.0
$ 87.7
$ 46.8
$ 10.7
$ 272.2
$ 48.9
$ 321.1
Aging Infrastructure 97.4
57.8
61.9
17.6
234.7
103.0
337.7
Load Growth ⁽¹⁾
31.9
48.1
11.8
(2.5 ) 89.3
28.3
117.6
Total Distribution 256.3
193.6
120.5
25.8
596.2
180.2
776.4
Generation —
—
8.5
—
8.5
—
8.5
Total Electric and Natural Gas Distribution Segment $ 256.3
$ 193.6
$ 129.0
$ 25.8
$ 604.7
$ 180.2
$ 784.9

⁽¹⁾ For the nine months ended September 30, 2017 and September 30, 2016, WMECO had $11.0 million and $6.4 million, respectively, of total contributions in aid of construction, which were credits to capital expenditures for those periods.

⁽²⁾ ~~In 2017, NSTAR Electric and WMECO incurred capital expenditures related to the construction of solar generation facilities.~~

For the electric distribution business, basic business includes the purchase of meters, tools, vehicles, information technology, transformer replacements, equipment facilities, and the relocation of plant. Aging infrastructure relates to reliability and the replacement of overhead lines, plant substations, underground cable replacement, and equipment failures. Load growth and other includes requests for new business and capacity additions on distribution lines and substation additions and expansions.

For the natural gas distribution ~~segment,~~business, basic business addresses daily operational needs including meters, pipe relocations due to public works projects, vehicles, and tools. Aging infrastructure projects seek to improve the reliability of the system through enhancements related to cast iron and bare steel replacement of main and services, corrosion mediation, and station upgrades. Load growth and other reflects growth in existing service territories including new developments, installation of services, and expansion.

For the water distribution business, basic business addresses daily operational needs including periodic meter replacement, water main relocation, facility maintenance, and tools. Aging infrastructure relates to reliability and the replacement of water mains, regulators, storage tanks, pumping stations, wellfields, reservoirs, and treatment facilities. Load growth and other reflects growth in our service territory, including improvements of acquisitions, installation of new services, and interconnections of systems.

Pending Acquisition of New England Service Company: On April 8, 2021, Aquarion and New England Service Company (NESC) entered into a definitive agreement pursuant to which Aquarion would acquire all outstanding shares of NESC. NESC provides regulated water service to approximately 10,000 customers in Connecticut, Massachusetts, and New Hampshire. The acquisition will be structured as a stock-for-stock exchange and Eversource will issue approximately 463,000 common shares at closing. The transaction requires approval from the PURA, DPU, NHPUC and other regulators and is expected to close by the end of 2021. On August 3, 2021, NESC shareholders voted to approve the pending acquisition. On October 27, 2021, PURA approved the transaction.

Offshore Wind Business: Our offshore wind business includes 50 percent ownership interests in both North East Offshore and Bay State Wind, which together hold PPAs and contracts for the Revolution Wind, South Fork Wind and Sunrise Wind projects, as well as offshore leases issued by BOEM. Our offshore wind projects are being developed and constructed through a joint and equal partnership with Ørsted. This partnership also participates in new procurement opportunities for offshore wind energy in the Northeast U.S.

The ~~natural gas distribution segment's capital spending program~~offshore leases include a 257 square-mile ocean lease off the coasts of Massachusetts and Rhode Island and a separate, adjacent 300-square-mile ocean lease located approximately 25 miles south of the coast of Massachusetts. In aggregate, these ocean lease sites jointly-owned by Eversource and Ørsted could eventually develop at least 4,000 MW of clean, renewable offshore wind energy.

We are preparing our final project designs and advancing the appropriate federal, state and local siting and permitting processes along with our offshore wind partner, Ørsted, all of which is competitively sensitive. We currently expect to make investments in our offshore wind business of approximately $300 million to $500 million during 2021, subject to advancing our final project designs and federal, state and local permitting processes. As of September 30, 2021 and December 31, 2020, Eversource's total equity investment balance in its offshore wind business was $1.13 billion and $887.1 million, respectively.

The following table provides a summary of the Eversource and Ørsted major projects with announced contracts:

Wind Project

State Servicing

Size (MW)

Term (Years)

Price per MWh

Pricing Terms

Contract Status

Revolution Wind

Rhode Island

400

$98.43

Fixed price contract; no price escalation

Approved

Revolution Wind

Connecticut

304

$98.43 - $99.50

Fixed price contracts; no price escalation

Approved

South Fork Wind

New York (LIPA)

$160.33

2 percent average price escalation

Approved

South Fork Wind

New York (LIPA)

$86.25

2 percent average price escalation

Approved

Sunrise Wind

New York (NYSERDA)

924 (1)

$110.37 (2)

Fixed price contract; no price escalation

Approved

(1) The contractual capacity increased from 880 MWs to 924 MWs, as allowed under the original agreement with NYSERDA.

(2) Index Offshore Wind Renewable Energy Certificate (OREC) strike price.

Our offshore wind projects are subject to receipt of federal, state and local approvals necessary to construct and operate the projects. The federal permitting process is governed by ~~$51.3 million~~BOEM, and state approvals are required from New York, Rhode Island and Massachusetts. Significant delays in the siting and permitting process resulting from the timeline for obtaining approval from BOEM and the state and local agencies could adversely impact the timing of these projects' in-service dates.

Federal Siting and Permitting Process: The South Fork Wind project has commenced the federal siting and permitting process with the filing of its Construction Operations Plan (COP) application with BOEM in 2018. The first major milestone in the BOEM review process is an issuance of a Notice of Intent (NOI) to complete an Environmental Impact Statement (EIS), which South Fork Wind received in 2018. In August 2020, we received the final review schedule from BOEM regarding South Fork Wind’s COP approval. In January 2021, BOEM released its Draft EIS for the South Fork Wind project and in August 2021, BOEM released its Final EIS, which assessed the environmental, social, and economic impacts of constructing the project and recommends measures to minimize impacts. The Final EIS will inform BOEM in deciding whether to approve the project or to approve with modifications. Identified impacts in the Final EIS included negligible to major adverse impacts to certain physical, biological or cultural resources from project construction and operations. The Final EIS also analyzed four alternatives to be evaluated as part of the process. Each of the identified alternative configurations had a similar level of environmental impacts, and if an alternative configuration was selected, the South Fork Wind project would still meet the contractual output under its PPA. The Record of Decision (ROD) is expected in November 2021 and will identify the recommended alternative. The final decision is expected in January 2022.

Based on BOEM’s final review schedule and final United States Army Corps of Engineers approval, we expect to start construction on South Fork in early 2022. South Fork Wind is designated as a “Covered Project” pursuant to Title 41 of the Fixing America’s Surface Transportation Act (FAST41) and a Major Infrastructure Project under Section 3(e) of Executive Order 13807, which provides greater federal attention on meeting the project’s permitting timelines.

Revolution Wind and Sunrise Wind filed their COP applications with BOEM in March 2020 and September 2020, respectively. Both projects received FAST41 designation in 2020. On April 30, 2021, Revolution Wind received BOEM’s NOI to prepare an EIS for the review of the COP submitted by Revolution Wind. For Revolution Wind, a final EIS is expected in the first ~~nine months~~quarter of ~~2017, as compared~~2023, the Record of Decision in the second quarter of 2023, and a final decision is expected in the third quarter of 2023. On August 31, 2021, Sunrise Wind received BOEM’s NOI to prepare an EIS for the ~~first nine months~~review of ~~2016, primarily due~~the COP submitted by Sunrise Wind. For Sunrise Wind, a final EIS and Record of Decision is expected in the third quarter of 2023, and a final decision is expected in the fourth quarter of 2023.

State and Local Siting and Permitting Process: South Fork Wind commenced the New York state siting process in 2018. On September 17, 2020, South Fork Wind filed a Joint Proposal in the New York State Article VII siting application. Among other things, the Joint Proposal included proposed mitigations to ~~an increased investment in system replacement~~certain environmental, community and ~~reliability,~~construction impacts associated with constructing the project. South Fork Wind was joined by PSEG Long Island and several citizens advocacy organizations. On October 9, 2020, the Joint Proposal was signed by the New York Departments of Public Service, Environmental Conservation, Transportation and State as well as ~~upgrades~~the Office of Parks, Recreation and Historic Preservation. On March 18, 2021, the New York Public Service Commission approved an order adopting the Joint Proposal and granting a Certificate of Environmental Compatibility and Public Need. Two petitions for re-hearing of the New York Public Service Commission decision have been filed, and South Fork Wind responded on May 3, 2021 opposing the re-hearing requests. In April 2021, South Fork Wind filed its Environmental Management and Construction Plan (EM&CP) with the New York Public Service Commission, which details the plans on how the project will be constructed in accordance with the conditions of the approved Joint Proposal. Comments from reviewing agencies and parties have been received and South Fork Wind has responded to ~~our LNG facilities. We~~and addressed those comments in the plan which was re-submitted in September 2021.A final approval of the EM&CP is expected by the fourth quarter 2021.

On September 10, 2020, the Town of East Hampton and the East Hampton Town Trustees announced that they had reached an agreement with South Fork Wind to issue the necessary easements and other real estate rights necessary to construct the South Fork Wind project. The Town approved the easements on January 21, 2021, and Trustees approved the lease on January 25, 2021.

State permitting applications in Rhode Island for Revolution Wind and in New York for Sunrise Wind were filed in December 2020. The Revolution Wind state siting application was deemed complete on January 22, 2021, and the preliminary hearing was completed on March 22, 2021. On April 26, 2021, the Rhode Island Energy Facilities Siting Board issued a Preliminary Decision and Order on scheduling with Advisory Opinions for local and state agencies. All advisory opinions were received in August, in accordance with the expedited schedule, and evidentiary hearings began in October 2021. The Sunrise Wind state siting application was deemed complete on July 1, 2021, initiating the formal review process, and Sunrise Wind filed a formal notice of intent to commence settlement negotiations towards a Joint Proposal on August 31, 2021.

Projected In-Service Dates: Based on BOEM’s permit schedule outlining when BOEM will complete its review of the South Fork Wind COP, we expect the ~~LNG facility upgrades to cost approximately $200 million and~~South Fork Wind project to be ~~placed~~in-service by the end of 2023. For Revolution Wind and Sunrise Wind, based on the BOEM permit schedule included in ~~service~~each respective NOI, we currently expect in-service dates in ~~late 2019.~~2025 for both projects, and are continuing to analyze the overall project schedules.

FERC Regulatory Matters

FERC ROE Complaints: Four separate complaints ~~have been~~were 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")~~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 billed of 10.57 percent and the maximum ROE for transmission incentive ~~("incentive cap")~~(incentive cap) of 11.74 percent, asserting that these ROEs were unjust and unreasonable.

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

⁽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,~~September 30, 2021 and ~~$5.3 million at WMECO), reflecting both the base ROE and incentive cap prescribed by the FERC order.~~

⁽³⁾ ~~The~~December 31, 2020. 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.~~2021 and December 31, 2020.

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~~A change of a 10 basis ~~point change~~points to the base ROE used to establish the reserves would impact Eversource's after-tax earnings by an average of approximately $3 million for each of the four 15-month complaint ~~periods~~periods. From the date of a final FERC order, based off of estimated 2021 rate base, a change of 10 basis points to the base ROE would ~~affect Eversource's~~impact Eversource’s future annual after-tax earnings by approximately $3$5 million, or $0.01 per share, per year, and will increase slightly over time as we continue to invest in our transmission infrastructure.

FERC Notice of Inquiry on ROE: On March 21, 2019, FERC issued a Notice of Inquiry (NOI) seeking comments from all stakeholders on FERC's policies for evaluating ROEs for electric public utilities, and interstate natural gas and oil pipelines. On June 26, 2019, the NETOs jointly filed comments supporting the methodology established in the FERC’s October 16, 2018 order with minor enhancements going forward. The NETOs jointly filed reply comments in the FERC ROE NOI on July 26, 2019. On May 12, 2020, the NETOs filed supplemental comments in the NOI ROE docket. At this time, Eversource cannot predict how this proceeding will affect its transmission ROEs.

FERC Notice of Inquiry and Proposed Rulemaking on Transmission Incentives: On March 21, 2019, FERC issued an NOI seeking comments on FERC's policies for implementing electric transmission incentives. On June 26, 2019, Eversource filed comments requesting that FERC retain policies that have been effective in encouraging new transmission investment and remain flexible enough to attract investment in new and emerging transmission technologies. Eversource filed reply comments on August 26, 2019. On March 20, 2020, FERC issued a Notice of Proposed Rulemaking (NOPR) on transmission incentives. The NOPR intends to revise FERC’s electric transmission incentive policies to reflect competing uses of transmission due to generation resource mix, technological innovation and shifts in load patterns. FERC proposes to grant transmission incentives based on measurable project economics and reliability benefits to consumers rather than its current project risks and challenges framework. On July 1, 2020, Eversource filed comments generally supporting the NOPR.

On April 15, 2021, FERC issued a Supplemental NOPR that proposes to eliminate the existing 50 basis point return on equity for utilities that have been participating in a regional transmission organization (RTO ROE incentive) for more than three years. On June 25, 2021, the NETOs jointly filed comments strongly opposing the Commission’s proposal. On July 26, 2021, the NETOs filed Supplemental NOPR reply comments responding to various parties advocating for the elimination of the RTO Adder. If the FERC issues a final order eliminating the RTO ROE incentive as proposed in the Supplemental NOPR, the estimated annual impact (using 2020 actual data) on Eversource’s after-tax earnings is approximately $15 million.

~~NSTAR Electric and WMECO Merger FERC Filings:~~ ~~On January 13, 2017, Eversource made two filings with FERC related to the proposed merger of WMECO into NSTAR Electric with~~ The Supplemental NOPR contemplates an ~~anticipated~~ effective date 30 days from the final order.

At this time, Eversource cannot predict the ultimate outcome of ~~December 31, 2017. One filing requests FERC approval of the merger,~~these proceedings, including possible appellate review, and the ~~other filing requests FERC approval of NSTAR Electric's assumption of WMECO's short-term debt obligations. The FERC approved the merger~~resulting impact on ~~March 2, 2017 and will act on the assumption of debt filing by the end of 2017.~~its transmission incentives.

Regulatory Developments and Rate Matters

Electric, ~~and~~ Natural Gas and Water Utility 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,~~2021, 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~~2020 Form 10-K.

Connecticut:

~~On April 20, 2017, PURA approved the joint request of~~ CL&P ~~the Connecticut Office of Consumer Counsel~~Deferred Storm Costs: In 2021 and ~~the Connecticut Attorney General~~2020, multiple tropical and severe storms caused extensive damage to ~~amend the deadline to establish new~~CL&P’s electric distribution ~~rates~~systems and customer outages, along with significant pre-staging costs. These storms resulted in deferred pre-staging and storm restoration costs of $195 million for 2021 storms and $344 million for 2020 storms, including the ~~2012 Connecticut merger settlement agreemen~~t ~~from "no later than December 1, 2017" to "no later than July 1, 2018." On October 27, 2017,~~ catastrophic impact of Tropical Storm Isaias in August 2020, among others. Management believes all these storm costs were prudently incurred and meet the criteria for specific cost recovery.

CL&P ~~filed a letter~~Tropical Storm Isaias Costs: On August 4, 2020, Tropical Storm Isaias caused catastrophic damage to our electric distribution system, which resulted in significant numbers and durations of ~~intent with PURA to request a rate increase~~customer outages, primarily in Connecticut. In terms of ~~$255.8 million, $45 million and $36 million effective May 1, 2018, 2019, and 2020, respectively.~~

~~Massachusetts:~~

~~Eversource and NSTAR Electric Boston Harbor Civil Action:~~ ~~On July 15, 2016, the United States Attorney on behalf~~customer outages, this storm was one of the ~~United States Army Corps~~worst in CL&P’s history. PURA will investigate the prudence of ~~Engineers filed a civil action~~costs incurred by CL&P to restore service in the United States District Court for the District of Massachusetts under provisions of the Rivers 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 failedresponse 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 litigationTropical Storm Isaias. That investigation is expected to occur either in a separate proceeding not yet initiated or as part of CL&P’s next rate review proceeding. Tropical Storm Isaias resulted in deferred storm restoration costs of approximately $234 million at CL&P and $251 million at Eversource as of September 30, 2021. The estimated cost of restoration may continue to change as additional cost information becomes available and final post-storm costs are deferred or capitalized. Although PURA found that CL&P’s performance in its preparation for and response to Tropical Storm Isaias fell below applicable performance standards in certain instances, CL&P believes it will be ~~dismissed~~able to present credible evidence in a future proceeding demonstrating there is no reasonably close causal connection between the alleged sub-standard performance and the storm costs incurred. While it is possible that some amount of storm costs may be disallowed by PURA in a future proceeding, any such amount cannot be estimated at this time. Eversource and CL&P continue to believe that these storm restoration costs associated with ~~prejudice.~~

~~In 2017,~~Tropical Storm Isaias were prudently incurred and meet the criteria for cost recovery; and as a result, ofmanagement does not expect the settlement, NSTAR Electric expensed $4.9 million (pre-tax) 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 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 proposalstorm cost review 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 requested a revenue decoupling rate mechanism for NSTAR Electric. WMECO has a revenue decoupling mechanism in place. The DPU will also be reviewing the proposed December 31, 2017 merger of NSTAR Electric and WMECO as part of the rate case. A final decision from the DPU is expected in late 2017, with new rates anticipated to be effective January 1, 2018.

~~New Hampshire:~~

~~Generation Divestiture~~: On 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, 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 the final plan and auction process were approved by the NHPUC in November 2016.

On October 12, 2017, PSNH filed an application with 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. Upon completion, full recovery of 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 bonds that will be secured by a non-bypassable charge or through recoveries in future rates billed to PSNH's customers.

As of September 30, 2017, PSNH's energy service rate base balance was approximately $594 million, and the carrying value of PSNH's total generation assets subject to divestiture was approximately $767 million.

~~Legislative and Policy Matters~~

On August 11, 2017, Massachusetts issued final legislation, pursuant to Executive Order 569, which established volumetric limits on multiple greenhouse emission sources to ensure reductions are realized by deadlines established in the Massachusetts Global Warming Solutions Act enacted in 2008. Under this legislation, the initial target date for reduction in greenhouse gas emissions has been established in the year 2020. The legislation is not expectedPURA to have a material impact on the financial ~~statements~~position or results of operations of Eversource or CL&P.

In exchange for the $75 million of customer credits and assistance, PURA’s interim rate reduction docket was resolved without findings. As a result of the settlement agreement, neither the 90 basis point reduction to CL&P’s return on equity introduced in PURA’s storm-related decision issued April 28, 2021, nor the 45 basis point reduction to CL&P’s return on equity included in PURA’s draft decision issued September 14, 2021 in the interim rate reduction docket, will be implemented.

CL&P has also agreed that its current base distribution rates shall be frozen, subject to the customer credits described above, until no earlier than January 1, 2024. The rate freeze applies only to base distribution rates (including storm costs) and not to other rate mechanisms such as the retail rate components, rate reconciling mechanisms, formula rates and any other adjustment mechanisms. The rate freeze also does not apply to any cost recovery mechanism outside of the base distribution rates with regard to grid-modernization initiatives or any other proceedings, either currently pending or that may be initiated during the rate freeze period, that may place additional obligations on CL&P. The approval of the settlement agreement satisfies the Connecticut statute of rate review requirements that requires electric utilities to file a distribution rate case within four years of the last rate case.

As part of the settlement agreement, CL&P agreed to withdraw with prejudice its pending appeals of PURA’s April 28, 2021 and July 14, 2021 decisions related to Storm Isaias and agreed to waive its right to file an appeal and seek a judicial stay of the final decision in the interim rate reduction docket. The settlement agreement assures that CL&P will have the opportunity to petition for and demonstrate the prudence of the storm costs incurred to respond to customer outages associated with Storm Isaias in a future ratemaking proceeding.

The cumulative pre-tax impact of the settlement agreement and the Storm Isaias assessment imposed in PURA’s April 28, 2021 and July 14, 2021 decisions totaled $103.6 million, and the after-tax earnings impact was $85.8 million, or $0.25 per share, for the nine months ended September 30, 2021.

CL&P Rate Adjustment Mechanisms (RAM) Filing: On July 31, 2020, PURA temporarily suspended its June 26, 2020 approval of certain delivery rate components effective July 1, 2020, and ordered CL&P to restore rates to those in effect as of June 30, 2020 in order to allow PURA time to reexamine the rates. Rates were adjusted effective August 1, 2020. On December 2, 2020, PURA issued a final decision in which it adjusted the timing of the annual rate adjustments for the Transmission Adjustment Clause (TAC) charge, the Non-Bypassable Federally Mandated Congestion Charge (NBFMCC), the Electric System Improvements Tracker (ESI), Competitive Transition Assessment (CTA), System Benefits Charge (SBC) and Revenue Decoupling Mechanism (RDM) so that these rates take effect on May 1st of each year. On April 28, 2021, PURA issued its interim decision on CL&P’s proposal that accepted the May 1, 2021 rate proposals for the CTA, TAC, ESI and RDM, but ordered that these rate changes go into effect on June 1, 2021, as opposed to May 1, 2021. Further, PURA elected to keep in place the current rates for the NBFMCC and SBC until further review of the costs being recovered in those rates could be performed. Finally, PURA indicated it would further review CL&P’s proposal to begin recovery of 2020 under-recoveries associated with these rates on October 1, 2021, and over what the period of recovery would be at a later time.

On September 15, 2021, PURA issued its final decision in the 2020 RAM reconciliation filing, which required no adjustment to the GSC, BFMCC, NBFMCC and SBC rates, changed the TAC and RDM rates effective October 1, 2021, and maintained the CTA, ESI and base distribution rates in effect as of June 1, 2021. As part of this decision, PURA also approved two separate amortization periods, effective October 1, 2021, allowing for the collection of cumulative under-recoveries totaling $193 million as of December 31, 2020 associated with the NBFMCC and TAC rates over a 31-month period and the RDM rate over a 15-month period. PURA also required CL&P to apply the prime rate, retroactive to January 1, 2020, when calculating carrying charges for the under- or over-recoveries included in the rate components, which impacted the NBFMCC, SBC, CTA, and TAC rates.

CL&P Impact of Third Quarter 2021 Rate Changes: On September 1, 2021, CL&P adjusted its rates for the $28.4 million penalty imposed by PURA for non-compliance with performance standards that is being provided as credits on customer bills over a one-year period. On October 1, 2021, CL&P implemented new TAC and RDM delivery rates. In total, CL&P implemented an overall net rate increase of $0.00174 per kWh for residential Rate 1 customers for these rate component charges, net of the rate decrease for the storm penalty credit. For residential customers with 700 kWh monthly usage, the impact of the September 1 and October 1, 2021 rate changes equated to a net increase of $1.22 on monthly customer bills.

Massachusetts:

NSTAR ~~Electric or WMECO.~~Gas and EGMA Mitigation Filings: On October 6, 2021, NSTAR Gas and EGMA made filings with the DPU regarding the deferral of certain costs for the purpose of mitigating November 1, 2021 bill impacts associated with new delivery rates as a result of increases in natural gas supply costs, thereby providing rate relief to customers. These adjustments to rates do not impact the recovery of costs, only the timing of when the costs are collected in rates. For NSTAR Gas and EGMA, these adjustments included delaying portions of the base distribution rate changes, the decoupling revenue requirement, and the recovery of certain prior period under-collections until November 1, 2022. These adjustments delay recovery of $16.7 million for NSTAR Gas and $19.7 million for EGMA for a one-year period. These adjustments will result in the under-recovery of costs beginning November 1, 2021, with no impact on the statement of income.

NSTAR Gas Distribution Rates: As part of an inflation-based mechanism, NSTAR Gas submitted its first annual Performance Based Rate Adjustment filing on September 15, 2021. Subsequently, NSTAR Gas filed a mitigation plan on October 6, 2021 to defer recovery of the base distribution rate change for NSTAR Gas until November 1, 2022 associated with depreciation and property tax expense for the 2019 and 2020 non-GSEP investments. The DPU approved a $13.6 million increase to base distribution rates on October 29, 2021 for effect on November 1, 2021.

EGMA Distribution Rates: As established in the October 7, 2020 EGMA Rate Settlement Agreement, EGMA filed for its first base distribution rate increase on September 17, 2021. The DPU approved a $13 million increase to base distribution rates on October 28, 2021 for effect on November 1, 2021.

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~~2020 Form 10-K. There have been no material changes with regard to these critical accounting policies.

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~~See Note 9B, "Commitments and Contingencies – Long-Term Contractual Arrangements," for discussion of material changes to contractual obligations ~~identified and no material changes with regard to the contractual obligations and commercial commitments previously disclosed in~~since the Eversource ~~2016~~2020 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~~2021 and ~~2016~~2020 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)	2021		2020		Increase/(Decrease)		2021		2020		Increase/(Decrease)
Operating Revenues	$	2,432.8	$	2,343.6	$	89.2	$	7,381.2	$	6,670.5	$	710.7
Operating Expenses:
Purchased Power, Fuel and Transmission	880.6		806.3		74.3		2,529.2		2,313.0		216.2
Operations and Maintenance	389.1		332.0		57.1		1,265.8		1,006.1		259.7
Depreciation	276.8		244.5		32.3		822.2		721.2		101.0
Amortization	45.2		57.5		(12.3)		158.9		130.7		28.2
Energy Efficiency Programs	143.8		145.0		(1.2)		460.8		408.8		52.0
Taxes Other Than Income Taxes	213.9		197.1		16.8		623.8		556.7		67.1

Total Operating Expenses	1,949.4		1,782.4		167.0		5,860.7		5,136.5		724.2
Operating Income	483.4		561.2		(77.8)		1,520.5		1,534.0		(13.5)
Interest Expense	148.0		134.0		14.0		431.2		403.2		28.0
Other Income, Net	43.8		29.2		14.6		124.6		83.6		41.0
Income Before Income Tax Expense	379.2		456.4		(77.2)		1,213.9		1,214.4		(0.5)
Income Tax Expense	94.1		108.2		(14.1)		294.5		275.6		18.9
Net Income	285.1		348.2		(63.1)		919.4		938.8		(19.4)
Net Income Attributable to Noncontrolling Interests	1.9		1.9		—		5.6		5.6		—
Net Income Attributable to Common Shareholders	$	283.2	$	346.3	$	(63.1)	$	913.8	$	933.2	$	(19.4)

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 %

Eversource's consolidated financial information includes the results of EGMA beginning on October 9, 2020. The natural gas distribution assets acquired from CMA on October 9, 2020 were assigned to EGMA.

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

Operating Revenues

~~A summary of our Operating Revenues by segment is as follows:~~

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.~~

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, is as follows:


	Electric				Firm Natural Gas				Water
	Sales Volumes (GWh)		Percentage (Decrease)/Increase		Sales Volumes (MMcf)		Percentage Increase		Sales Volumes (MG)		Percentage Decrease
Three Months Ended September 30:	2021	2020			2021	2020			2021	2020
Traditional	2,097	2,110	(0.6)	%	—	—	—	%	397	770	(48.4)	%
Decoupled and Special Contracts (1)(2)	12,197	12,281	(0.7)	%	16,545	15,951	3.7	%	6,856	8,102	(15.4)	%
Total Sales Volumes	14,294	14,391	(0.7)	%	16,545	15,951	3.7	%	7,253	8,872	(18.2)	%

Nine Months Ended September 30:
Traditional	5,901	5,805	1.7	%	—	—	—	%	967	1,686	(42.6)	%
Decoupled and Special Contracts (1)(2)	33,071	32,404	2.1	%	107,337	103,286	3.9	%	16,863	17,658	(4.5)	%
Total Sales Volumes	38,972	38,209	2.0	%	107,337	103,286	3.9	%	17,830	19,344	(7.8)	%

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 %

(1) 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.

(2) Eversource acquired CMA's natural gas distribution assets on October 9, 2020. Prior year sales volumes have been presented for comparative purposes.

~~Three Months Ended:~~

~~Operating Revenues, which primarily consist of base~~Weather, fluctuations in energy supply costs, conservation measures (including utility-sponsored energy efficiency programs), and economic conditions affect customer energy usage and water consumption. Industrial sales volumes are less sensitive to temperature variations than residential and commercial sales volumes. In our service territories, weather impacts both electric and water sales volumes during the summer and both electric and natural gas ~~distribution revenues and tracked revenues further described below, decreased by $51.2 million for~~sales volumes during the ~~three months ended September 30, 2017, as compared to the same period in 2016.~~

~~Base electric and~~winter; however, natural gas ~~distribution revenues~~: Base electric distribution segment revenues, excluding LBR, decreased $21.0 million for the three months ended September 30, 2017, as compared to the same period in 2016, due primarily to a decrease in sales volumes ~~and lower demand revenues driven by~~are more sensitive to temperature variations than electric sales volumes. Customer heating or cooling usage may not directly correlate with historical levels or with the ~~mild summer weather during the third quarter~~level of ~~2017 at NSTAR Electric and PSNH. LBR increased $1.5 million for the three months ended September 30, 2017, as compared to the same period in 2016.~~ degree-days that occur.

~~Base natural gas distribution revenues remained relatively unchanged for the three months ended September 30, 2017, as compared to the same period in 2016.~~

Fluctuations in retail electric sales volumes at PSNH impact earnings ("Traditional" in the table above). For CL~~&P's, WMECO's~~&P, NSTAR Electric, NSTAR Gas, EGMA, Yankee Gas, and ~~NSTAR Gas'~~our Connecticut water distribution business, fluctuations in retail sales volumes do not materially impact ~~the level of base distribution revenue realized or~~ earnings due to their respective regulatory ~~commission approved revenue decoupling mechanisms. The~~commission-approved distribution revenue decoupling mechanisms ~~permit recovery of a base amount of~~("Decoupled" in the table above). These distribution revenues ~~and break~~are decoupled from their customer sales volumes, which breaks the relationship between sales volumes and revenues recognized. ~~Revenue decoupling mechanisms result~~

Operating Revenues: Operating Revenues by segment increased for the three and nine months ended September 30, 2021, as compared to the same periods in 2020, as follows:


(Millions of Dollars)	Three Months Ended		Nine Months Ended
Electric Distribution	$	(5.1)	$	150.2
Natural Gas Distribution	75.3		507.8
Electric Transmission	29.0		94.5
Water Distribution	(2.3)		(5.6)
Other	3.8		98.4
Eliminations	(11.5)		(134.6)
Total Operating Revenues	$	89.2	$	710.7

Electric and Natural Gas (excluding EGMA) Distribution Revenues:

Base Distribution Revenues:

•Base electric distribution revenues increased $3.9 million and $36.3 million for the three and nine months ended September 30, 2021, as compared to the same periods in 2020, respectively, due primarily to the impact of base distribution rate increases at NSTAR Electric effective January 1, 2021, at PSNH effective January 1, 2021 and August 1, 2021, and at CL&P effective May 1, 2020, partially offset by a base distribution rate decrease at CL&P implemented June 1, 2021. The decrease in the CL&P base distribution rate on June 1, 2021 was due primarily to the completion of the recovery of ~~our approved~~certain storm cost amortization and therefore the base rate decrease did not impact earnings.

•Base natural gas distribution revenues increased $7.9 million and $48.5 million for the three and nine months ended September 30, 2021, as compared to the same periods in 2020, respectively, due primarily to base distribution ~~revenue requirements.~~ rate increases at NSTAR Gas effective November 1, 2020, which includes a shift of recovery into base rates of certain GSEP investments, and at Yankee Gas effective January 1, 2021. Although new rates at Yankee Gas were implemented on March 1, 2021 to customers, the provisions of the base distribution rate increase were effective January 1, 2021.

Electric distribution revenues also decreased $65 million for the three and nine months ended September 30, 2021, as compared to the same periods in 2020, due to CL&P’s settlement agreement on October 1, 2021, in which CL&P agreed to provide a total of $65 million of customer credits to be distributed based on customer sales over a two-month period from December 1, 2021 to January 31, 2022. In the third quarter of 2021, CL&P recorded a current regulatory liability associated with the provisions of the settlement agreement, with a $65 million pre-tax charge as a reduction to Operating Revenues. Additionally, CL&P recorded a $28.4 million reserve in the first quarter of 2021 for a civil penalty for non-compliance with storm performance standards that is currently being provided as credits to customer bills beginning on September 1, 2021 over a one-year period. The penalty was reclassified from Operations and Maintenance expense to a reduction of Operating Revenues in the third quarter of 2021 in connection with the finalization of the settlement agreement. For further information, see "Regulatory Developments and Rate Matters - Connecticut" included in this Management’s Discussion and Analysis.

Tracked Distribution Revenues:Tracked distribution ~~revenues:~~ ~~Tracked~~ revenues consist of certain costs that are recovered from customers in retail rates through regulatory commission-approved cost tracking mechanisms and therefore, ~~have~~recovery of these costs has no impact on earnings. ~~Costs recovered through~~Revenues from certain of these cost tracking mechanisms also include energy supply procurement costs and other energy-related costs for our electric and natural gas customers, retail transmission charges, energy efficiency program costs, and restructuring and stranded cost recovery revenues. In addition, certain ~~tracked revenues include~~ incentives earned, return on capital tracking mechanisms, and carrying charges that are billed in rates to ~~customers. Tracked natural gas distribution segment revenues increased as a result of an increase in~~customers, which do impact earnings. Costs recovered through cost tracking mechanisms include, among others, energy supply and natural gas supply procurement and other energy-related costs, ~~($7.6 million) and an increase in~~electric retail transmission charges, energy efficiency program ~~revenues ($2.2 million). Tracked~~costs, electric ~~distribution revenues decreased as a result of a decrease in retail electric transmission charges ($39.8 million), a decrease in~~restructuring and stranded cost recovery revenues ~~($16.9 million)~~(including securitized RRB charges), ~~a decrease in~~and additionally for the Massachusetts utilities, pension and PBOP benefits and net metering for distributed generation. Tracked revenues also include wholesale market sales transactions, such as sales of energy ~~efficiency program revenues ($13.9 million)~~ and ~~a decrease in pension rate adjustment mechanisms ($7.1 million). Partially offsetting these decreases were increases in tracked electric~~energy-related products into the ISO-NE wholesale electricity market, sales of natural gas to third party marketers, and the sale of RECs to various counterparties.

Tracked distribution revenues ~~related~~increased/(decreased) for the three and nine months ended September 30, 2021, as compared to electric energy supply costs ($7.3 million), revenues related to renewable energy requirements ($10.8 million), net metering revenues ($7.0 million) and federally-mandated congestion charges ($2.8 million).

~~Electric transmission revenues:~~ ~~The electric transmission segment revenues increased by $21.7 million~~the same periods in 2020, due primarily to the ~~recovery of higher revenue requirements associated with ongoing investments~~following:


	Electric Distribution				Natural Gas Distribution
(Millions of Dollars)	Three Months Ended		Nine Months Ended		Three Months Ended		Nine Months Ended
Retail Tariff Tracked Revenues:
Energy supply procurement	$	(47.2)	$	(148.0)	$	8.9	$	40.0
Retail transmission	77.0		156.2		—		—
Other distribution tracking mechanisms	(11.4)		36.9		1.5		12.7
Wholesale Market Sales Revenue	54.2		149.0		(3.2)		(1.1)

The decrease in ~~our transmission infrastructure.~~

~~Other:~~ ~~Other revenues decreased due primarily~~energy supply procurement within electric distribution for the three months ended September 30, 2021, as compared to the ~~sale of Eversource's unregulated telecommunication business on December 31, 2016 ($5.0 million).~~

~~Nine Months Ended:~~

~~Operating Revenues decreased~~same period in 2020, was driven primarily by ~~$6.0 million~~lower average supply-related sales volumes, partially offset by higher average prices. The decrease in energy supply procurement within electric distribution for the nine months ended September 30, ~~2017,~~2021, as compared to the same period in ~~2016.~~

~~Base electric~~2020, was driven primarily by lower average supply-related sales volumes and lower average prices. The increase in energy supply procurement within natural gas distribution for the three and nine months ended September 30, 2021, as compared to the same periods in 2020, was driven primarily by higher average prices. The increase for the nine-month period was also attributable to higher average supply-related sales volumes.

Fluctuations in retail transmission revenues~~: Base~~ are driven by the recovery of the costs of our wholesale transmission business, such as those billed by ISO-NE and Local and Regional Network Service charges. For further information, see "Purchased Power and Transmission Expense" below.

The increase in electric distribution wholesale market sales revenue was due primarily to higher average electricity market prices received for wholesale sales at CL&P for both the three and nine months ended September 30, 2021, as compared to the same periods in 2020. ISO-NE average market prices received for CL&P’s wholesale sales increased approximately 100 percent and 96 percent for the three and nine months ended September 30, 2021, respectively, as compared to the same periods in 2020, driven primarily by higher natural gas prices in New England.Volumes sold into the market were primarily from the sale of output generated by the Millstone PPA that CL&P entered into in 2019, as required by regulation.

EGMA Natural Gas Distribution Revenues: The addition of EGMA increased total operating revenues at the natural gas distribution segment by $62.8 million and $412.1 million for the three and nine months ended September 30, 2021, respectively.

Electric Transmission Revenues: Electric transmission revenues ~~excluding LBR, decreased $13.2~~increased $29.0 million and $94.5 million for the three and nine months ended September 30, 2021, respectively, as compared to the same periods in 2020, due primarily to a higher transmission rate base as a result of our continued investment in our transmission infrastructure. The increase in electric transmission revenues for the nine months ended September 30, ~~2017,~~2021, as compared to the same period in ~~2016, due~~2020, was partially offset by a lower benefit from the annual billing and cost reconciliation filing with FERC.

Other Revenues and Eliminations: Other revenues primarily include the revenues of Eversource's service company, most of which are eliminated in consolidation. Eliminations are also primarily related to ~~a decrease in sales volumes driven by~~ the ~~mild summer weather during~~Eversource electric transmission revenues that are derived from ISO-NE regional transmission charges to the ~~third quarter~~distribution businesses of ~~2017 at~~CL&P, NSTAR Electric and ~~PSNH. LBR increased $10.6 million for~~PSNH that recover the ~~nine months ended September 30, 2017, as compared~~costs of the wholesale transmission business in rates charged to ~~the same period in 2016.~~ their customers.

Base natural gas distribution revenues remained relatively unchanged for the nine months ended September 30, 2017, as compared to the same period in 2016. The impact of higher firm natural gas sales volumes was offset by lower demand revenues in Connecticut driven by lower peak usage in 2017, as compared to 2016.

~~Tracked distribution revenues:~~ Tracked natural gas distribution segment revenues increased as a result of an increase in natural gas supply costs ($57.8 million) and an increase in energy efficiency program revenues ($17.1 million). Tracked electric distribution revenues decreased as a result of a decrease in electric energy supply costs ($81.0 million), driven by decreased average retail prices and lower sales volumes, a decrease in retail electric transmission charges ($45.9 million), a decrease in transition and stranded cost recovery revenues ($33.1 million), a decrease in pension rate adjustment mechanisms ($16.2 million), and a decrease in energy efficiency program revenues ($8.8 million). Partially offsetting these decreases were increases in tracked electric distribution revenues related to federally-mandated congestion charges ($23.0 million), net metering revenues ($22.4 million) and revenues related to renewable energy requirements and the sale of PSNH's RECs ($14.7 million).

~~Electric transmission revenues:~~ The electric transmission segment revenues increased by $77.5 million due primarily to the recovery of higher revenue requirements associated with ongoing investments in our transmission infrastructure.

~~Other:~~ ~~Other revenues decreased due primarily to the sale of Eversource's unregulated telecommunication business on December 31, 2016 ($15.0 million).~~

Purchased Power, Fuel and Transmissionexpense includes costs associated with purchasing electricity and natural gas on behalf of our ~~customers.~~customers and the cost of energy purchase contracts, as required by regulation. These ~~energy~~electric and natural gas supply costs and other energy-related costs are recovered from customers in rates through commission-approved cost tracking mechanisms, which have no impact on earnings (tracked costs). ~~Total~~ Purchased Power, Fuel and Transmission expense ~~decreased~~increased for the three and nine months ended September 30, ~~2017,~~2021, as compared to the same periods in ~~2016,~~2020, due primarily to the following:


(Millions of Dollars)	Three Months Ended		Nine Months Ended
Purchased Power Costs	$	(25.2)	$	(81.5)
Natural Gas Costs	47.0		222.1
Transmission Costs	79.8		155.5
Eliminations	(27.3)		(79.9)
Total Purchased Power, Fuel and Transmission	$	74.3	$	216.2

(Millions of Dollars) Three Months Ended Increase/(Decrease) Nine Months Ended
Increase/(Decrease)
Electric Distribution $ (0.4 ) $ (109.1 )
Natural Gas Distribution 7.0
50.1
Transmission (20.6 ) 12.2
Total Purchased Power, Fuel and Transmission $ (14.0 ) $ (46.8 )

The decrease in purchased power expense at the electric distribution business for the three months ended September 30, 2021, as compared to the same period in 2020, was driven primarily by lower expense related to the procurement of energy supply resulting from lower average supply-related sales volumes, partially offset by higher average prices. The decrease in purchased power expense at the electric distribution business for the nine months ended September 30, ~~2017,~~2021, as compared to the same period in ~~2016,~~2020, was driven primarily by lower ~~prices associated with~~expense related to the procurement of energy supply resulting from lower average supply-related sales volumes and lower ~~sales volumes.~~ average prices. The lower energy supply expense in the three and nine-month periods was partially offset by higher long-term contractual energy-related costs that are recovered in the NBFMCC mechanism at CL&P.

The increase in ~~purchased power expense~~costs at the natural gas distribution ~~business for each of the periods presented was due to higher average natural gas prices and higher sales volumes. The decrease in transmission costs~~segment for the three and nine months ended September 30, ~~2017,~~2021, as compared to the same ~~period~~periods in ~~2016,~~2020, was due primarily to the addition of EGMA natural gas supply costs as a result of ~~a decrease in~~ the ~~retail transmission cost deferral, which reflects~~2020 CMA asset acquisition of $18.4 million and $140.9 million, respectively, as well as higher average prices. The increase for the ~~actual costs of transmission service compared~~nine-month period was also attributable to ~~estimated amounts billed to customers.~~ higher average supply-related sales volumes.

The increase in transmission costs for the three and nine months ended September 30, ~~2017,~~2021, as compared to the same ~~period~~periods in ~~2016,~~2020, was primarily the result of an increase in costs billed by ISO-NE that support regional grid ~~investment,~~investments and an increase in Local Network Service charges, which ~~reflect~~reflects the cost of transmission service provided by Eversource over our local transmission network. ~~This was partially offset by a decrease in the retail transmission cost deferral.~~

Operations and Maintenance expense includes tracked costs and costs that are part of base electric, ~~and~~ natural gas and water distribution rates with changes impacting earnings (non-tracked costs). Operations and Maintenance expense ~~decreased~~increased for the three and nine months ended September 30, ~~2017,~~2021, as compared to the same periods in ~~2016,~~2020, due primarily to the following:


(Millions of Dollars)	Three Months Ended		Nine Months Ended
Base Electric Distribution (Non-Tracked Costs):
CL&P assessment by PURA for Tropical Storm Isaias response; reflected as reduction to Operating Revenues in the third quarter of 2021 in connection with the finalization of the settlement agreement	$	(28.4)	$	—
CL&P charge to fund various customer assistance initiatives associated with the settlement agreement on October 1, 2021	10.0		10.0
Employee-related expenses, including labor and benefits	(3.8)		22.9
Funding of CL&P storm reserve as part of June 1, 2021 rate change	6.0		10.0
Storm restoration costs	2.7		20.4
Vegetation Management	9.3		11.6
Operations-related expenses, including vehicles and outside services	1.4		5.6
Shared corporate costs (including computer software depreciation at Eversource Service)	4.9		15.8
Other non-tracked operations and maintenance	0.2		6.2
Total Base Electric Distribution (Non-Tracked Costs)	2.3		102.5
Tracked Costs (Electric Distribution and Electric Transmission)	5.8		22.7
Natural Gas Distribution:
Base (Non-Tracked) Costs, excluding EGMA	2.6		5.8
Tracked Costs, excluding EGMA	1.5		4.8
EGMA Operations and Maintenance	33.6		119.2
Total Natural Gas Distribution	37.7		129.8
Water Distribution:
Absence in 2021 of gain on sale of Hingham water system in July 2020	16.0		16.0
Other	0.1		0.1
Total Water Distribution	16.1		16.1
Parent and Other Companies and eliminations:
Eversource Parent and Other Companies - other operations and maintenance	3.5		81.8
Transition and Acquisition Costs	(1.4)		6.2
Eliminations	(6.9)		(99.4)
Total Operations and Maintenance	$	57.1	$	259.7

(Millions of Dollars) Three Months Ended Increase/(Decrease)
Nine Months Ended
Increase/(Decrease)
Base Electric Distribution:
Employee-related expenses, including labor and benefits $ (15.0 ) $ (46.2 )
Bad debt expense (2.6 ) (15.3 )
Shared corporate costs (including computer software depreciation at Eversource Service) 5.4
15.0
Storm restoration costs (4.0 ) 3.1
Boston Harbor civil action settlement charge recorded in the second quarter of 2017 —
4.9
Other operations and maintenance 9.1
15.7
Total Base Electric Distribution (7.1 ) (22.8 )
Total Base Natural Gas Distribution:
Shared corporate costs (including computer software depreciation at Eversource Service) 1.2
3.6
Other operations and maintenance (4.1 ) (1.5 )
Total Base Natural Gas Distribution (2.9 ) 2.1
Total Tracked costs (Electric Distribution, Electric Transmission and Natural Gas Distribution) (5.5 ) 7.2
Other and eliminations:
Eversource Parent and Other Companies (1.1 ) 0.8
Eliminations (7.7 ) (19.5 )
Total Operations and Maintenance $ (24.3 ) $ (32.2 )

Depreciation expense increased for the three and nine months ended September 30, ~~2017,~~2021, as compared to the same periods in ~~2016,~~2020, due ~~primarily~~ to higher utility plant in service ~~balances.~~balances, and due to the addition of EGMA utility plant balances as a result of the 2020 CMA asset acquisition of $12.0 million and $35.5 million, respectively.

Amortization ~~of Regulatory Assets, Net~~ expense includes the deferral of energy supply, ~~and~~ energy-related costs and other costs that are included in certain ~~regulatory-approved~~regulatory commission-approved cost tracking ~~mechanisms, and the amortization of certain costs. The~~mechanisms. This deferral adjusts expense to match the corresponding ~~revenues.~~revenues compared to the actual costs incurred. Energy supply and energy-related costs are recovered from customers in rates and have no impact on earnings. Amortization expense also includes the amortization of ~~Regulatory Assets, Net,~~certain costs as those costs are collected in rates.

Amortization decreased for the three months ended September 30, ~~2017~~2021, as compared to the same period in 2020, due primarily to a decrease in storm amortization expense at CL&P related to the completion of the amortization period of certain storm cost deferred assets. The decrease was partially offset by an increase in the deferral adjustment of energy supply, energy-related and other costs. Amortization increased for the nine months ended September 30, ~~2017,~~2021, as compared to the same ~~periods~~period in ~~2016,~~2020, due primarily to the deferral adjustment of energy supply, energy-related and ~~energy-related~~other costs, which can fluctuate from period to period based on the timing of costs incurred and ~~the~~ related rate changes to recover these costs. ~~Energy supply and energy-related costs~~The increase for the nine-month period was partially offset by a decrease in storm amortization expense at CL&P ~~NSTAR Electric, PSNH and WMECO, which are~~related to the ~~primary drivers in~~completion of the amortization ~~are recovered from customers in rates and have no impact on earnings.~~period of certain storm cost deferred assets.

Energy Efficiency Programsexpense decreased for the three ~~and nine~~ months ended September 30, ~~2017,~~2021, as compared to the same ~~periods~~period in ~~2016,~~2020, due primarily to the deferral ~~adjustments~~adjustment at CL&P, ~~NSTAR Electric and WMECO, partially offset by deferral adjustments at the natural gas businesses,~~ which ~~reflect~~reflects the actual costs of energy efficiency programs compared to the ~~estimated~~ amounts billed to ~~customers. The deferral adjusts costs incurred to match~~customers, and the timing of the recovery of energy efficiency ~~revenue~~costs. Energy Efficiency increased for the nine months ended September 30, 2021, as compared to the same period in 2020, due primarily to the addition of EGMA energy efficiency program costs as a result of the 2020 CMA asset acquisition of $45.7 million. The increase in the first nine months of 2021 was also due to the deferral adjustment at NSTAR Electric and PSNH, which reflects the actual costs of energy efficiency programs compared to the amounts billed to customers, and the timing of the recovery of energy efficiency costs. The costs for ~~various~~the majority of the state energy policy initiatives and expanded energy efficiency programs are recovered from customers in rates and have no impact on earnings.

~~Interest Expense~~Taxes Other Than Income Taxes expense increased for the three and nine months ended September 30, ~~2017,~~2021, as compared to the same periods in ~~2016,~~2020, due primarily to an increase in property taxes as a result of higher utility plant balances, the addition of EGMA property taxes as a result of the 2020 CMA asset acquisition of $6.2 million and $24.1 million, respectively, and higher Connecticut gross earnings taxes.

Interest Expense increased for the three months ended September 30, 2021, as compared to the same period in 2020, due primarily to an increase in interest on long-term debt ~~($5.8 million and $15.9 million, respectively)~~ as a result of new debt issuances ($7.8 million), an increase in interest expense on regulatory deferrals ($5.1 million), and ~~higher~~an increase in interest on ~~short-term~~notes payable ($1.2 million), partially offset by an increase in AFUDC related to debt ~~($2.4 million~~funds and ~~$4.8 million, respectively)~~other capitalized interest ($0.5 million).

~~Other Income, Net~~Interest Expense increased for the ~~three and~~ nine months ended September 30, ~~2017,~~2021, as compared to the same ~~periods~~period in ~~2016,~~2020, due primarily to ~~increased gains~~an increase in interest on ~~investments~~long-term debt as a result of new debt issuances ($~~4.2 million~~23.5 million), an increase in interest expense on regulatory deferrals ($8.0 million), and ~~$24.9 million, respectively)~~higher amortization of debt discounts and premiums, net ($0.8 million), ~~primarily~~partially offset by a decrease in interest on notes payable ($3.4 million), a decrease in RRB interest expense ($1.0 million) and an increase in AFUDC related to ~~Eversource's investment~~debt funds and other capitalized interest ($0.6 million).

Other Income, Net increased for the three months ended September 30, 2021, as compared to the same period in ~~a renewable energy fund, market value changes~~2020, due primarily to an increase related to pension, SERP and PBOP non-service income components ($10.7 million) and an increase in interest income primarily from regulatory deferrals ($5.8 million), partially offset by investment losses in 2021 compared to investment income in 2020 driven by market volatility ($1.7 million).

Other Income, Net increased for the ~~deferred compensation plans~~nine months ended September 30, 2021, as compared to the same period in 2020, due primarily to an increase related to pension, SERP and PBOP non-service income components ($~~2.9 million~~29.6 million), an increase in interest income primarily from regulatory deferrals ($13.9 million) and ~~$5.1 million, respectively) and higher~~investment income in 2021 compared to investment losses in 2020 driven by market volatility ($2.2 million), partially offset by lower AFUDC related to equity funds ($~~1.2 million and $5.0 million, respectively)~~3.1 million).

Income Tax Expense decreased for the three months ended September 30, ~~2017,~~2021, as compared to the same period in ~~2016,~~2020, due primarily to lower pre-tax earnings ($~~2.4~~16.5 million), higher share-based payment excess tax benefits ($0.1 million), and the absence of the sale of Hingham water system ($12.5 million), partially offset by higher state taxes ($4.4 million), a decrease in amortization of EDIT ($0.9 million), an increase in items that impact our tax rate as a result of regulatory treatment (flow-through items) and permanent differences ($~~1.2~~5.1 million), and a return to provision adjustment ($4.6 million).

Income Tax Expense increased for the nine months ended September 30, ~~2017,~~2021, as compared to the same period in ~~2016,~~2020, due primarily to higher ~~pre-tax earnings~~state taxes ($~~20.6~~17.8 million), ~~the absence of~~lower share-based payment excess tax benefits ($2.6 million), a ~~tax credit in 2017~~return to provision adjustment ($~~2.4~~4.6 million), and ~~higher state taxes~~an increase in items that impact our tax rate as a result of regulatory treatment (flow-through items) and permanent differences ($~~1.3~~7.8 million), partially offset by ~~flow-through items~~the absence of the sale of Hingham water system ($12.5 million) and ~~permanent differences~~an increase in amortization of EDIT ($~~4.6~~1.4 million).

RESULTS OF OPERATIONS –

THE CONNECTICUT LIGHT AND POWER COMPANY

NSTAR ELECTRIC COMPANY AND SUBSIDIARY

PUBLIC SERVICE COMPANY OF NEW HAMPSHIRE AND SUBSIDIARIES

The following provides the amounts and variances in operating revenues and expense line items in the statements of income for CL&P, NSTAR Electric and PSNH for the ~~three and~~ nine months ended September 30, ~~2017~~2021 and ~~2016~~2020 included in this combined Quarterly Report on Form 10-Q:


	For the Nine Months Ended September 30,
	CL&P						NSTAR Electric						PSNH
(Millions of Dollars)	2021		2020		Increase/ (Decrease)		2021		2020		Increase/ (Decrease)		2021		2020		Increase/ (Decrease)
Operating Revenues	$	2,736.5	$	2,711.4	$	25.1	$	2,343.1	$	2,270.2	$	72.9	$	887.2	$	815.3	$	71.9
Operating Expenses:
Purchased Power and Transmission	1,073.7		1,089.2		(15.5)		711.7		702.1		9.6		279.5		273.3		6.2
Operations and Maintenance	465.6		417.7		47.9		421.6		369.3		52.3		168.2		151.8		16.4
Depreciation	253.1		238.7		14.4		251.5		238.2		13.3		89.5		74.5		15.0
Amortization of Regulatory Assets, Net	76.6		37.2		39.4		24.0		69.1		(45.1)		62.7		39.0		23.7
Energy Efficiency Programs	100.8		109.7		(8.9)		226.1		210.7		15.4		30.5		29.2		1.3
Taxes Other Than Income Taxes	275.3		260.6		14.7		163.5		154.1		9.4		69.7		58.4		11.3
Total Operating Expenses	2,245.1		2,153.1		92.0		1,798.4		1,743.5		54.9		700.1		626.2		73.9
Operating Income	491.4		558.3		(66.9)		544.7		526.7		18.0		187.1		189.1		(2.0)
Interest Expense	124.4		115.0		9.4		106.7		95.0		11.7		42.7		44.1		(1.4)
Other Income, Net	21.7		16.3		5.4		58.9		38.2		20.7		11.6		10.9		0.7
Income Before Income Tax Expense	388.7		459.6		(70.9)		496.9		469.9		27.0		156.0		155.9		0.1
Income Tax Expense	104.6		103.5		1.1		114.6		106.3		8.3		32.5		37.5		(5.0)
Net Income	$	284.1	$	356.1	$	(72.0)	$	382.3	$	363.6	$	18.7	$	123.5	$	118.4	$	5.1

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 $ 774.8
$ 760.0
$ 14.8
1.9 % $ 2,173.6
$ 2,175.1
$ (1.5 ) (0.1 )%
Operating Expenses:

Purchased Power and Transmission 259.0
253.5
5.5
2.2
711.2
760.6
(49.4 ) (6.5 )
Operations and Maintenance 123.1
123.0
0.1
0.1
359.8
356.4
3.4
1.0
Depreciation 63.7
57.7
6.0
10.4
184.3
172.2
12.1
7.0
Amortization of Regulatory Assets, Net 34.6
23.4
11.2
47.9
58.8
30.3
28.5
94.1
Energy Efficiency Programs 37.7
44.4
(6.7 ) (15.1 ) 106.5
118.0
(11.5 ) (9.7 )
Taxes Other Than Income Taxes 79.2
81.9
(2.7 ) (3.3 ) 223.4
227.9
(4.5 ) (2.0 )
Total Operating Expenses 597.3
583.9
13.4
2.3
1,644.0
1,665.4
(21.4 ) (1.3 )
Operating Income 177.5
176.1
1.4
0.8
529.6
509.7
19.9
3.9
Interest Expense 36.3
36.1
0.2
0.6
106.6
108.6
(2.0 ) (1.8 )
Other Income, Net 7.5
3.7
3.8
(a)
14.1
10.9
3.2
29.4
Income Before Income Tax Expense 148.7
143.7
5.0
3.5
437.1
412.0
25.1
6.1
Income Tax Expense 52.6
57.1
(4.5 ) (7.9 ) 159.5
155.4
4.1
2.6
Net Income $ 96.1
$ 86.6
$ 9.5
11.0 % $ 277.6
$ 256.6
$ 21.0
8.2 %

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

Operating Revenues

~~CL&P's~~Sales Volumes: A summary of our retail electric GWh sales volumes ~~were~~is as follows:


	For the Nine Months Ended September 30,
	2021	2020	Increase	Percentage Increase
CL&P	15,728	15,318	410	2.7	%
NSTAR Electric	17,343	17,086	257	1.5	%
PSNH	5,901	5,805	96	1.7	%

For the Three Months Ended September 30, For the Nine Months Ended September 30,
2017 2016 Decrease Percent 2017 2016 Decrease Percent
Retail Sales Volumes in GWh 5,644
6,225
(581 ) (9.3 )% 15,812
16,541
(729 ) (4.4 )%

Fluctuations in retail electric sales volumes at PSNH impact earnings. For CL&P and NSTAR Electric, fluctuations in retail electric sales volumes do not impact earnings due to their respective regulatory commission-approved distribution revenue decoupling mechanisms.

~~Three Months Ended:~~

~~CL&P's~~Operating Revenues: Operating Revenues, which consist of base distribution revenues and tracked revenues further described below, increased ~~by $14.8~~$25.1 million at CL&P, $72.9 million at NSTAR Electric, and $71.9 million at PSNH, for the ~~three~~nine months ended September 30, ~~2017,~~2021, as compared to the same period in ~~2016.~~2020.

~~Fluctuations in~~ Base Distribution Revenues:

•CL&P's ~~sales volumes do~~distribution revenues decreased $3.5 million due primarily to the base distribution rate decrease implemented June 1, 2021. The decrease in the base distribution rate on June 1, 2021 was due primarily to the completion of the recovery of certain storm cost amortization and therefore the base rate decrease did not impact earnings. Excluding the ~~level~~reduction to revenue resulting from the completion of certain storm cost amortization, base distribution ~~revenue realized or earnings~~revenues increased due to the ~~PURA-approved revenue decoupling mechanism. CL&P's revenue decoupling mechanism permits recovery~~impact of a base ~~amount of~~distribution rate increase effective May 1, 2020.

•NSTAR Electric's distribution revenues ~~($1.059 billion annually)~~increased $17.6 million due primarily to the impact of its base distribution rate increase effective January 1, 2021.

•PSNH's distribution revenues increased $22.2 million due primarily to the impact of its base distribution rate increases effective January 1, 2021 and ~~breaks~~August 1, 2021.

Electric distribution revenues also decreased $65 million for the ~~relationship between~~nine months ended September 30, 2021, as compared to the same period in 2020, due to CL&P’s settlement agreement on October 1, 2021, in which CL&P agreed to provide a total of $65 million of customer credits to be distributed based on customer sales ~~volumes and revenues recognized. The revenue decoupling mechanism results~~over a two-month period from December 1, 2021 to January 31, 2022. In the third quarter of 2021, CL&P recorded a current regulatory liability associated with the provisions of the settlement agreement, with a $65 million pre-tax charge as a reduction to Operating Revenues. Additionally, CL&P recorded a $28.4 million reserve in the ~~recovery~~first quarter of ~~approved base distribution revenue requirements.~~

~~Fluctuations~~2021 for a civil penalty for non-compliance with storm performance standards that is currently being provided as credits to customer bills beginning on September 1, 2021 over a one-year period. The penalty was reclassified from Operations and Maintenance expense to a reduction of Operating Revenues in the ~~overall level~~third quarter of ~~operating revenues are primarily related to tracked revenues.~~ 2021 in connection with the finalization of the settlement agreement. For further information, see "Regulatory Developments and Rate Matters - Connecticut" included in this Management’s Discussion and Analysis.

Tracked Revenues: Tracked distribution revenues consist of certain costs that are recovered from customers in retail rates through ~~PURA-approved~~regulatory commission-approved cost tracking mechanisms and therefore, ~~have~~recovery of these costs has no impact on earnings. Revenues from certain of these cost tracking mechanisms also include certain incentives earned, return on capital tracking mechanisms, and carrying charges that are billed in rates to customers, which do impact earnings. Costs recovered through cost tracking mechanisms include, among others, energy supply procurement and other energy-related costs, retail transmission charges, energy efficiency program costs, ~~and~~electric restructuring and stranded cost recovery ~~revenues. In addition, certain tracked~~ revenues (including securitized RRB charges), and additionally for NSTAR Electric, pension and PBOP benefits and net metering for distributed generation. Tracked revenues also include ~~incentives earned~~wholesale market sales transactions, such as sales of energy and ~~carrying charges that are billed in rates~~energy-related products into the ISO-NE wholesale electricity market and the sale of RECs to ~~customers.~~ various counterparties.

Tracked ~~distribution~~ revenues increased primarily as a result of an increase in energy supply costs ($27.1 million) driven by increased average retail prices. Partially offsetting this increase was a decrease in stranded cost recovery revenues ($7.6 million) and a decrease in retail transmission charges ($7.6 million).

~~Transmission revenues increased by $6.3 million due primarily to the recovery of higher revenue requirements associated with ongoing investments in our transmission infrastructure.~~

~~Nine Months Ended:~~

~~CL&P's Operating Revenues decreased by $1.5 million~~increased/(decreased) for the nine months ended September 30, ~~2017,~~2021, as compared to the same period in ~~2016.~~2020, due primarily to the following:


(Millions of Dollars)	CL&P		NSTAR Electric		PSNH
Retail Tariff Tracked Revenues:
Energy supply procurement	$	(30.5)	$	(102.8)	$	(14.7)
Retail transmission	22.6		97.9		35.7
Other distribution tracking mechanisms	(5.9)		29.2		13.6
Wholesale Market Sales Revenue	114.2		24.9		9.9

~~Tracked~~

The decrease in energy supply procurement at CL&P and PSNH was driven primarily by lower average prices, partially offset by higher average supply-related sales volumes. The decrease in energy supply procurement at NSTAR Electric was driven by both lower average prices and lower average supply-related sales volumes. Fluctuations in retail transmission revenues are driven by the recovery of the costs of our wholesale transmission business, such as those billed by ISO-NE and Local and Regional Network Service charges. For further information, see "Purchased Power and Transmission Expense" below.

The increase in electric distribution wholesale market sales revenue was due primarily to higher average electricity market prices received for wholesale sales at CL&P for the nine months ended September 30, 2021, as compared to the same period in 2020. ISO-NE average market prices received for CL&P’s wholesale sales increased approximately 96 percent for the nine months ended September 30, 2021, as compared to the same period in 2020, driven primarily by higher natural gas prices in New England.Volumes sold into the market were primarily from the sale of output generated by the Millstone PPA that CL&P entered into in 2019, as required by regulation.

Transmission Revenues: Transmission revenues ~~decreased~~increased $40.6 million at CL&P, $35.2 million at NSTAR Electric, and $18.7 million at PSNH for the nine months ended September 30, 2021, as compared to the same period in 2020, due primarily to a higher transmission rate base as a result of a decrease in energy supply costs ($25.0 million) driven by decreased average retail prices and lower sales volumes. In addition, there was a $17.8 million decrease in stranded cost recovery revenues. Partially offsetting these decreases was an increase in federally-mandated congestion charges ($23.0 million).

~~Transmission revenues increased by $27.2 million due primarily to higher revenue requirements associated with ongoing investments~~our continued investment in our transmission infrastructure. The increase was partially offset by a lower benefit from the annual billing and cost reconciliation filing with FERC.

Eliminations: Eliminations are primarily related to the Eversource electric transmission revenues that are derived from ISO-NE regional transmission charges to the distribution businesses of CL&P, NSTAR Electric and PSNH that recover the costs of the wholesale transmission business in rates charged to their customers. The impact of eliminations decreased revenues by $22.1 million at CL&P, $34.5 million at NSTAR Electric and $18.0 million at PSNH for the nine months ended September 30, 2021, as compared to the same period in 2020.

Purchased Power and Transmission expense includes costs associated with purchasing electricity on behalf of CL~~&P's customers.~~&P, NSTAR Electric and PSNH's customers and the cost of energy purchase contracts, as required by regulation. These energy supply and other energy-related costs are recovered from customers in rates through ~~PURA-approved~~commission-approved cost tracking mechanisms, which have no impact on earnings (tracked costs). ~~Total~~ Purchased Power and Transmission expense decreased/increased ~~for the three months ended September 30, 2017, and decreased~~ for the nine months ended September 30, ~~2017,~~2021, as compared to the same ~~periods~~period in ~~2016,~~2020, due primarily to the following:


(Millions of Dollars)	CL&P		NSTAR Electric		PSNH
Purchased Power Costs	$	(16.0)	$	(53.1)	$	(12.4)
Transmission Costs	21.6		97.2		36.7
Eliminations	(21.1)		(34.5)		(18.1)
Total Purchased Power and Transmission	$	(15.5)	$	9.6	$	6.2

(Millions of Dollars) Three Months Ended Increase/(Decrease)
Nine Months Ended
Increase/(Decrease)
Purchased Power Costs $ 5.7
$ (68.1 )
Transmission Costs (0.2 ) 18.7
Total Purchased Power and Transmission $ 5.5
$ (49.4 )

Purchased Power Costs: Included in purchased power costs are the costs associated with CL&P's GSC, CTA and FMCC tracking mechanisms and deferred energy supply costs. The increase in purchased power costs for the three months ended September 30, 2017, as compared to the same period in 2016, was due primarily to GSC-related purchased power expenses. The GSC recovers energy-related costs incurred as a result of providing electric generation service supply to all customers who have not migrated to third party ~~suppliers.~~ suppliers and the cost of energy purchase contracts, as required by regulation.

•The decrease ~~in purchased power costs for the nine months ended September 30, 2017, as compared to the same period in 2016,~~at CL&P was due primarily to ~~a decrease~~lower expense related to the procurement of energy supply resulting from lower average prices, partially offset by higher average supply-related sales volumes. The lower energy supply expense was partially offset by higher long-term contractual energy-related costs that are recovered in the ~~price~~NBFMCC mechanism.

•The decrease at NSTAR Electric was due primarily to lower expense related to the procurement of ~~standard offer~~energy supply ~~also associated with the GSC,~~resulting from lower average prices and lower average supply-related sales volumes.

•The decrease at PSNH was due primarily to lower expense related to the procurement of energy supply resulting from lower average prices, partially offset by higher average supply-related sales volumes.

Transmission Costs: Included in transmission costs are charges that recover the cost of transporting electricity over high-voltage lines from generation facilities to substations, including costs allocated by ISO-NE to maintain the wholesale electric market.

•The increase in transmission costs ~~for~~at CL&P was due primarily to an increase in Local Network Service charges, which reflect the ~~nine months ended September 30, 2017, as compared to the same period in 2016, was primarily the result~~cost of transmission service provided by Eversource over our local transmission network, and an increase in costs billed by ISO-NE that support regional grid ~~investment, and Local Network Service charges, which reflect the cost of transmission service.~~investments. This was partially offset by a decrease in the retail transmission cost deferral, which reflects the actual costs of transmission service compared to estimated amounts billed to customers.

~~Operations and Maintenance~~ expense includes tracked costs and costs that are part of base distribution rates with changes impacting earnings (non-tracked costs). Operations and Maintenance expense increased for the three months ended September 30, 2017, as compared to the same period in 2016, driven by a $0.4 million increase in non-tracked costs, which was primarily attributable to higher shared corporate costs, partially offset by lower employee-related expenses, lower storm restoration costs and lower vegetation management costs. The increase in non-tracked costs was partially offset by a $0.3 million decrease in tracked costs, which was primarily attributable to lower tracked system resiliency, lower bad debt expense and lower employee-related costs, partially offset by higher transmission expenses.

Operations and Maintenance expense increased for the nine months ended September 30, 2017, as compared to the same period in 2016, driven by a $6.5 million increase in tracked costs, which was primarily attributable to higher transmission expenses, partially offset by lower tracked bad debt expense. Non-tracked costs decreased $3.0 million, which was primarily attributable to lower employee-related expenses, lower bad debt expense and lower vegetation management costs, partially offset by higher shared corporate costs, higher storm restoration costs, and higher system resiliency project costs.

~~Depreciation~~ ~~expense increased for the three and nine months ended September 30, 2017, as compared to the same periods in 2016, due primarily to higher utility plant in service balances.~~

~~Amortization of Regulatory Assets, Net~~ expense includes the deferral of energy supply and energy-related costs and the amortization of certain costs, which are recovered from customers in rates and have no impact on earnings. The deferral adjusts expense to match the corresponding revenues. The increase for the three and nine months ended September 30, 2017, as compared to the same periods in 2016, was due primarily to the fluctuation of the deferral, which can fluctuate from period to period based on the timing of costs incurred and related rate changes to recover these costs.

~~Energy Efficiency Programs~~ expense decreased for the three and nine months ended September 30, 2017, as compared to the same periods in 2016, due primarily to the deferral adjustment, which reflects the actual cost of energy efficiency programs compared to the estimated amounts billed to customers and the timing of the recovery of energy efficiency costs. The deferral adjusts costs incurred to match energy efficiency revenue billed to customers. The costs for various state policy initiatives are recovered from customers in rates and have no impact on earnings.

~~Taxes Other Than Income Taxes~~ ~~expense~~decreased for the three and nine months ended September 30, 2017, as compared to the same periods in 2016, due primarily to a decrease in gross earnings taxes, partially offset by an increase in property taxes due to higher plant balances. Gross earnings taxes are tracked costs and have no impact on earnings.

~~Income Tax Expense~~ decreased for the three months ended September 30, 2017, as compared to the same period in 2016, due primarily to the true-up of the return to provision impacts ($4.7 million) and items that impact our tax rate as a result of regulatory treatment (flow-through items) and permanent differences ($1.5 million), partially offset by higher pre-tax earnings ($1.7 million).

Income Tax Expense increased for the nine months ended September 30, 2017, as compared to the same period in 2016, due primarily to higher pre-tax earnings ($8.8 million) and higher state taxes ($2.6 million), partially offset by the true-up of the return to provision impacts ($4.7 million) and flow-through items and permanent differences ($2.6 million).

~~EARNINGS SUMMARY~~

~~CL&P's earnings increased $9.5 million~~for the three months ended September 30, 2017, as compared to the same period in 2016, due primarily to a lower effective tax rate, an increase in transmission earnings driven by a higher transmission rate base, and higher distribution revenues due in part to a higher rate base for the system resiliency program, partially offset by higher depreciation expense.

CL&P's earnings increased $21.0 million for the nine months ended September 30, 2017, as compared to the same period in 2016, due primarily to an increase in transmission earnings driven by a higher transmission rate base, higher distribution revenues due in part to a higher rate base for the system resiliency program, and lower non-tracked operations and maintenance expense. These favorable earnings impacts were partially offset by higher depreciation expense.

~~LIQUIDITY~~

~~Cash totaled $9.4 million as of September 30, 2017, compared with $6.6 million as of December 31, 2016.~~

CL&P had cash flows provided by operating activities of $623.3 million for the nine months ended September 30, 2017, as compared to $614.4 million in the same period of 2016. The increase in operating cash flows was due primarily to the favorable impact of the timing of regulatory recoveries and the timing of collections and payments of our working capital items, including accounts receivable and accounts payable. Partially offsetting these favorable impacts were the income tax payments of $19.8 million made in 2017, compared to the income tax refunds of $128.5 million received in 2016.

Eversource parent has a $1.45 billion commercial paper program allowing Eversource parent to issue commercial paper as a form of short-term debt, with intercompany loans to certain subsidiaries, including CL&P. The weighted-average interest rate on the commercial paper borrowings as of September 30, 2017 and December 31, 2016 was 1.34 percent and 0.88 percent, respectively. There were no intercompany loans from Eversource parent to CL&P as of September 30, 2017. As of December 31, 2016, there were intercompany loans from Eversource parent to CL&P of $80.1 million. Eversource parent, and certain of its subsidiaries, including CL&P, are parties to a five-year $1.45 billion revolving credit facility. The revolving credit facility terminates on September 4, 2021. The revolving credit facility serves to backstop Eversource parent's $1.45 billion commercial paper program. There were no borrowings outstanding on the revolving credit facility as of September 30, 2017 and December 31, 2016.

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, CL&P repaid at maturity $100 million of 5.75 percent 2007 Series C First Mortgage Bonds.~~

Investments in Property, Plant and Equipment on the statements of cash flows do not include amounts incurred on capital projects but not yet paid, cost of removal, AFUDC related to equity funds, and the capitalized portions of pension expense. CL&P's investments in property, plant and equipment totaled $621.9 million for the nine months ended September 30, 2017.

~~RESULTS OF OPERATIONS – NSTAR ELECTRIC COMPANY AND SUBSIDIARY~~

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

For the Nine Months Ended September 30,
(Millions of Dollars) 2017 2016 Increase/
(Decrease) Percent
Operating Revenues $ 1,913.5
$ 1,986.0
$ (72.5 ) (3.7 )%
Operating Expenses:

Purchased Power and Transmission 689.8
764.9
(75.1 ) (9.8 )
Operations and Maintenance 266.2
279.9
(13.7 ) (4.9 )
Depreciation 167.6
159.2
8.4
5.3
Amortization of Regulatory Assets, Net 17.8
18.3
(0.5 ) (2.7 )
Energy Efficiency Programs 198.8
212.9
(14.1 ) (6.6 )
Taxes Other Than Income Taxes 99.0
101.8
(2.8 ) (2.8 )
Total Operating Expenses 1,439.2
1,537.0
(97.8 ) (6.4 )
Operating Income 474.3
449.0
25.3
5.6
Interest Expense 70.0
62.2
7.8
12.5
Other Income, Net 8.7
7.6
1.1
14.5
Income Before Income Tax Expense 413.0
394.4
18.6
4.7
Income Tax Expense 161.3
154.5
6.8
4.4
Net Income $ 251.7
$ 239.9
$ 11.8
4.9 %

~~Operating Revenues~~

~~NSTAR Electric's retail sales volumes were as follows:~~

For the Nine Months Ended September 30,
2017 2016 Decrease Percent
Retail Sales Volumes in GWh 15,204
15,746
(542 ) (3.4 )%

NSTAR Electric's Operating Revenues, which consist of base distribution revenues and tracked revenues further described below, decreased by $72.5 million for the nine months ended September 30, 2017, as compared to the same period in 2016.

~~Base distribution revenues~~: Base distribution revenues, excluding LBR, decreased $11.2 million for the nine months ended September 30, 2017, as compared to the same period in 2016, as a result of lower sales volumes in 2017, as compared to 2016 driven by the mild summer weather during the third quarter of 2017. LBR increased $10.6 million for the nine months ended September 30, 2017, as compared to the same period in 2016.

~~Tracked revenues:~~ Tracked revenues consist of certain costs that are recovered from customers in rates through DPU-approved cost tracking mechanisms and therefore, have no impact on earnings. Costs recovered through cost tracking mechanisms include energy supply procurement and other energy-related costs, retail transmission charges, energy efficiency program costs, net metering for distributed generation and transition cost recovery revenues. In addition, certain tracked revenues include incentives earned and carrying charges that are billed in rates to customers. Tracked distribution revenues decreased primarily as a result of a decrease in energy supply costs ($44.1 million) driven by decreased average retail prices and lower sales volumes, a decrease in retail transmission charges ($53.9 million), a decrease in the pension rate adjustment mechanism ($14.7 million), and a decrease in transition cost recovery revenues ($11.9 million). Partially offsetting these decreases were an increase in net metering revenues ($20.2 million) and an increase in revenues related to renewable energy requirements ($23.4 million).

~~Transmission revenues increased by $20.6 million due primarily to the recovery of higher revenue requirements associated with ongoing investments in our transmission infrastructure.~~

~~Purchased Power and Transmission~~ expense includes costs associated with purchasing electricity on behalf of NSTAR Electric's customers. These energy supply costs are recovered from customers in rates through DPU-approved cost tracking mechanisms, which have no impact on earnings (tracked costs). Total Purchased Power and Transmission expense decreased for the nine months ended September 30, 2017, as compared to the same period in 2016, due primarily to the following:

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

Included in purchased power costs are the costs associated with NSTAR Electric's basic service charge and deferred energy supply costs. The basic service charge recovers energy-related costs incurred as a result of providing electric generation service supply to all customers who have not migrated to third party suppliers. The decrease in purchased power costs was due primarily to lower prices associated with the procurement of energy supply and lower sales volumes. The decrease in transmission costs was primarily the result of a decrease in the retail transmission cost deferral, which reflects the actual costs of transmission service compared to estimated amounts billed to customers.

~~Operations and Maintenance~~ expense includes tracked costs and costs that are part of base distribution rates with changes impacting earnings (non-tracked costs). Operations and Maintenance expense decreased for the nine months ended September 30, 2017, as compared to the same period in 2016, driven by a $13.0 million decrease in non-tracked costs, which was primarily attributable to lower employee-related expenses, lower bad debt expense and lower storm restoration costs, partially offset by higher shared corporate costs, a $4.9 million charge recorded in the second quarter of 2017 related to the Boston Harbor civil action settlement, and higher vegetation management costs. Tracked costs decreased $0.7 million, which was primarily attributable to lower tracked employee-related expenses, partially offset by higher transmission expenses and higher tracked bad debt expense.

~~Depreciation~~ ~~expense increased for the nine months ended September 30, 2017, as compared to the same period in 2016, due primarily to higher utility plant in service balances.~~

~~Energy Efficiency Programs~~ expense decreased for the nine months ended September 30, 2017, as compared to the same period in 2016, due primarily to the deferral adjustment, which reflects the actual cost of energy efficiency programs compared to the estimated amounts billed to customers and the timing of the recovery of energy efficiency costs. The deferral adjusts costs incurred to match energy efficiency revenue billed to customers. The costs for various state policy initiatives are recovered from customers in rates and have no impact on earnings.

~~Taxes Other Than Income Taxes~~ ~~expense decreased for the nine months ended September 30, 2017, as compared to the same period in 2016, due primarily to a decrease in property tax rates and lower employment-related taxes.~~

~~Interest Expense~~ ~~increased for the nine months ended September 30, 2017, as compared to the same period in 2016, due primarily to new debt issuances.~~

~~Income Tax Expense~~ increased for the nine months ended September 30, 2017, as compared to the same period in 2016, due primarily to higher pre-tax earnings ($6.9 million), partially offset by items that impact our tax rate as a result of regulatory treatment (flow-through items) and permanent differences ($0.1 million).

~~EARNINGS SUMMARY~~

NSTAR Electric's earnings increased $11.8 million for the nine months ended September 30, 2017, as compared to the same period in 2016, due primarily to lower operations and maintenance expense and lower property tax expense, partially offset by lower sales volumes driven by the mild summer weather during the third quarter of 2017, and higher interest and depreciation expense.

~~LIQUIDITY~~

NSTAR Electric had cash flows provided by operating activities of $413.0 million for the nine months ended September 30, 2017, as compared to $564.3 million in the same period of 2016. The decrease in operating cash flows was due primarily to a decrease in regulatory recoveries, which were significantly impacted by the timing of collections of purchased power and transmission costs, an increase of $56.3 million in Pension and PBOP Plan cash contributions, and the income tax payments of $23.9 million made in 2017, compared to the income tax refunds of $28.1 million received in 2016. Partially offsetting these decreases was a favorable impact related to the timing of collections of accounts receivable.

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.

~~RESULTS OF OPERATIONS – PUBLIC SERVICE COMPANY OF NEW HAMPSHIRE AND SUBSIDIARY~~

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

For the Nine Months Ended September 30,
(Millions of Dollars) 2017 2016 Increase/
(Decrease) Percent
Operating Revenues $ 733.6
$ 727.8
$ 5.8
0.8 %
Operating Expenses:

Purchased Power, Fuel and Transmission 179.3
155.7
23.6
15.2
Operations and Maintenance 191.2
187.2
4.0
2.1
Depreciation 95.3
86.5
8.8
10.2
Amortization of Regulatory (Liabilities)/Assets, Net (10.7 ) 14.5
(25.2 ) (a)
Energy Efficiency Programs 11.0
10.9
0.1
0.9
Taxes Other Than Income Taxes 67.0
64.5
2.5
3.9
Total Operating Expenses 533.1
519.3
13.8
2.7
Operating Income 200.5
208.5
(8.0 ) (3.8 )
Interest Expense 38.7
37.4
1.3
3.5
Other Income, Net 2.9
1.0
1.9
(a)
Income Before Income Tax Expense 164.7
172.1
(7.4 ) (4.3 )
Income Tax Expense 65.1
66.3
(1.2 ) (1.8 )
Net Income $ 99.6
$ 105.8
$ (6.2 ) (5.9 )%

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

~~Operating Revenues~~

~~PSNH's retail sales volumes were as follows:~~

For the Nine Months Ended September 30,
2017 2016 Decrease Percent
Retail Sales Volumes in GWh 5,835
5,985
(150 ) (2.5 )%

PSNH's Operating Revenues, which consist of base distribution revenues and tracked revenues further described below, increased by $5.8 million for the nine months ended September 30, 2017, as compared to the same period in 2016.

~~Base distribution revenues~~: Base distribution revenues decreased $2.0 million for the nine months ended September 30, 2017, as compared to the same period in 2016, due primarily to a 2.5 percent decrease in sales volumes driven by the mild summer weather during the third quarter of 2017.

~~Tracked revenues:~~ Tracked revenues consist of certain costs that are recovered from customers in rates through NHPUC-approved cost tracking mechanisms and therefore, have no impact on earnings. Costs recovered through cost tracking mechanisms include energy supply procurement and energy-related costs, costs associated with the generation of electricity for customers, retail transmission charges, energy efficiency program costs and stranded cost recovery revenues. In addition, certain tracked revenues include incentives earned and carrying charges that are billed in rates to customers. Tracked distribution revenues decreased primarily as a result of a decrease in revenues related to the timing of the sale of RECs ($15.3 million) and a decrease in the energy service rate ($5.1 million). Partially offsetting these decreases was an increase in retail transmission charges ($7.2 million) and an increase in wholesale generation revenues ($4.0 million).

~~Transmission revenues increased by $17.6 million due primarily to the recovery of higher revenue requirements associated with ongoing investments in our transmission infrastructure.~~

~~Purchased Power, Fuel and Transmission~~ expense includes costs associated with PSNH's generation of electricity, as well as purchasing electricity on behalf of its customers. These generation and energy supply costs are recovered from customers in rates through NHPUC-approved cost tracking mechanisms, which have no impact on earnings (tracked costs). Total Purchased Power, Fuel and Transmission expense increased for the nine months ended September 30, 2017, as compared to the same period in 2016, due primarily to the following:

(Millions of Dollars) Increase
Purchased Power and Generation Fuel Costs $ 5.1
Transmission Costs 18.5
Total Purchased Power, Fuel and Transmission $ 23.6

In order to meet the demand of customers who have not migrated to third party suppliers, PSNH procures power through power supply contracts and spot purchases in the competitive New England wholesale power market and/or produces power through its own generation. The increase in purchased power and generation fuel costs was due primarily to higher purchased power energy expenses that are recovered as a component of the Energy Service rate, and Regional Greenhouse Gas Initiative related expenses recovered in the SCRC. •The increase in transmission costs at NSTAR Electric and PSNH was due primarily ~~the result of~~to an increase in costs billed by ISO-NE ~~that support regional grid investment,~~ and ~~Local Network Service charges, which reflect the cost of transmission service, as well as~~an increase in the retail transmission cost deferral, ~~which reflects actual costs of transmission service compared to estimated amounts billed to customers.~~partially offset by a decrease in Local Network Service charges.

Operations and Maintenance expense includes tracked costs and costs that are part of base distribution rates with changes impacting earnings (non-tracked costs). Operations and Maintenance expense increased for the nine months ended September 30, ~~2017,~~2021, as compared to the same period in ~~2016, driven by a $2.1 million increase in tracked costs, which was~~2020, due primarily ~~attributable~~ to higher transmission expenses, partially offset by lower employee-related expenses. Non-tracked costs increased by $1.9 million, which was primarily attributable to higher shared corporate costs and higher vegetation management costs, partially offset by lower employee-related expenses.the following:


(Millions of Dollars)	CL&P		NSTAR Electric		PSNH
Base Electric Distribution (Non-Tracked Costs):
CL&P charge to fund various customer assistance initiatives associated with the settlement agreement on October 1, 2021	$	10.0	$	—	$	—
Funding of CL&P storm reserve as part of June 1, 2021 rate change	10.0		—		—
Employee-related expenses, including labor and benefits	(3.5)		12.1		5.7
Storm restoration costs	7.7		9.3		3.4
Vegetation Management	1.0		0.6		10.0
Operations-related expenses, including vehicles and outside services	7.8		—		(2.2)
Shared corporate costs (including computer software depreciation at Eversource Service)	4.5		10.0		1.3
Other non-tracked operations and maintenance	1.6		2.8		1.8
Total Base Electric Distribution (Non-Tracked Costs)	39.1		34.8		20.0
Tracked Costs:
Transmission expenses	3.0		3.5		3.9
Other tracked operations and maintenance	5.8		14.0		(7.5)
Total Tracked Costs	8.8		17.5		(3.6)
Total Operations and Maintenance	$	47.9	$	52.3	$	16.4

Depreciation ~~expense~~ increased for the nine months ended September 30, ~~2017,~~2021, as compared to the same period in ~~2016,~~2020, for CL&P, NSTAR Electric and PSNH due ~~primarily~~ to higher ~~utility~~net plant in service balances.

Amortization of Regulatory ~~(Liabilities)/~~Assets, Net expense includes the deferral of energy supply, ~~and~~ energy-related costs and other costs that are included in certain regulatory-approved cost tracking mechanisms. This deferral adjusts expense to match the ~~amortization of certain~~corresponding revenues compared to the actual costs ~~which~~incurred. Energy supply and energy-related costs are recovered from customers in rates and have no impact on earnings. ~~The deferral adjusts~~Amortization expense ~~to match~~also includes the ~~corresponding revenues. The decrease~~amortization of certain costs as those costs are collected in rates. Amortization of Regulatory Assets, Net increased/decreased for the nine months ended September 30, ~~2017,~~2021, as compared to the same period in ~~2016,~~2020, due primarily to the following:

•The increase at CL&P was due primarily to the ~~fluctuation~~deferral adjustment of ~~the deferral,~~energy supply, energy-related and other tracked costs, which can fluctuate from period to period based on the timing of costs incurred and related rate changes to recover these costs. The increase was partially offset by a decrease in storm amortization expense related to the completion of the amortization period of certain storm cost deferred assets.

•The decrease at NSTAR Electric was due to the deferral adjustment of energy supply, energy-related costs and other tracked costs, which can fluctuate from period to period based on the timing of costs incurred and related rate changes to recover these costs.

•The increase at PSNH was due to the deferral adjustment of energy-related and other tracked costs, which can fluctuate from period to period based on the timing of costs incurred and related rate changes to recover these costs.

Energy Efficiency Programs expenseincludes costs of various state energy policy initiatives and expanded energy efficiency programs that are recovered from customers in rates, most of which have no impact on earnings. Energy Efficiency Programs expenseincreased/decreased for the nine months ended September 30, 2021, as compared to the same period in 2020, due primarily to the following:

•The decrease at CL&P was due to the deferral adjustment, which reflects actual costs of energy efficiency programs compared to the estimated amounts billed to customers, and the timing of the recovery of energy efficiency costs.

•The increases at NSTAR Electric and PSNH were due to the deferral adjustment, which reflects actual costs of energy efficiency programs compared to the estimated amounts billed to customers, and the timing of the recovery of energy efficiency costs.

Taxes Other Than Income Taxes ~~expense~~ increased for the nine months ended September 30, ~~2017,~~2021, as compared to the same period in ~~2016,~~2020, due primarily to the following:

•The increase at CL&P was related to higher property taxes as a result of a higher utility plant balance and higher gross earnings taxes.

•The increases at NSTAR Electric and PSNH were due to higher property taxes as a result of higher utility plant balances.

Interest Expense increased at CL&P and NSTAR Electric and decreased at PSNH for the nine months ended September 30, 2021, as compared to the same period in 2020, due primarily to the following:

•The increase at CL&P was due to higher interest on long-term debt ($4.0 million), a decrease in AFUDC related to debt funds ($3.4 million), and an increase in interest expense on regulatory deferrals ($2.4 million).

•Theincrease at NSTAR Electric was due to an increase in interest expense on regulatory deferrals ($6.1 million) and higher interest on long-term debt ($5.7 million).

•The decrease at PSNH was due to a decrease in interest expense on regulatory deferrals ($1.1 million) and a decrease in RRB interest expense ($1.0 million), partially offset by a decrease in AFUDC related to debt funds ($1.2 million).

Other Income, Net increased for the nine months ended September 30, 2021, as compared to the same period in 2020, due primarily to the following:

•The increase at CL&P was due primarily to an increase related to pension, SERP and PBOP non-service income components ($8.2 million), an increase in ~~property taxes~~interest income primarily on regulatory deferrals ($2.3 million), and an increase in investment income driven by market volatility ($1.2 million), partially offset by a decrease in AFUDC related to equity funds ($6.3 million).

•The increase at NSTAR Electric was due primarily to ~~higher plant balances.~~an increase related to pension, SERP and PBOP non-service income components ($8.1 million), an increase in interest income primarily on regulatory deferrals ($8.1 million), an increase in AFUDC related to equity funds ($2.8 million), and investment income in 2021 compared to investment losses in 2020 driven by market volatility ($2.1 million).

•The increase at PSNH was due primarily to an increase related to pension, SERP and PBOP non-service income components ($2.7 million) and an increase in investment income driven by market volatility ($0.2 million), partially offset by a decrease in AFUDC related to equity funds ($2.3 million).

Income Tax Expense increased/decreased for the nine months ended September 30, ~~2017,~~2021, as compared to the same period in ~~2016,~~2020, due primarily to the following:

•The increase at CL&P was due primarily to higher state taxes ($11.0 million), lower ~~pre-tax earnings~~share-based payment excess tax benefits ($~~2.6~~0.8 million), and an increase in items that impact our tax rate as a result of regulatory treatment (flow-through items) and permanent differences ($~~1.0~~4.2 million), partially offset by ~~the absence~~lower pre-tax earnings ($14.9 million).

•The increase at NSTAR Electric was due primarily to higher pre-tax earnings ($5.7 million), higher state taxes ($1.5 million), an increase in items that impact our tax rate as a result of regulatory treatment (flow-through items) and permanent differences ($0.2 million), and lower share-based payment excess tax benefits ($0.9 million).

•The decrease at PSNH was due primarily to an increase in amortization of EDIT ($4.2 million) and lower state taxes ($1.3 million), partially offset by lower share-based payment excess tax benefits ($0.3 million), higher pre-tax earnings ($0.1 million), and an increase in items that impact our tax rate as a ~~tax credit in 2017~~result of regulatory treatment (flow-through items) and permanent differences ($~~2.4~~0.1 million).

EARNINGS SUMMARY

~~PSNH's~~CL&P's earnings decreased ~~$6.2~~$72.0 millionfor the nine months ended September 30, ~~2017,~~2021, as compared to the same period in ~~2016,~~2020, due primarily to ~~lower generation~~the settlement agreement on October 1, 2021 resulting in a total $75 million pre-tax charge to earnings and a $28.6 million pre-tax charge for an assessment by PURA as a result of CL&P’s preparation for and response to Tropical Storm Isaias in August 2020 recorded in the first quarter of 2021. The after-tax impact of the settlement agreement and the storm performance assessment imposed by PURA was $85.8 million, or $0.25 per share. Earnings were also unfavorably impacted by higher operations and maintenance expense, a higher effective tax rate, higher depreciation expense, higher property ~~tax~~ and ~~depreciation~~other tax expense, and ~~lower sales volumes driven by the mild summer weather during the third quarter of 2017. These unfavorable~~higher interest expense. The earnings ~~impacts were~~decrease was partially offset by higher earnings from its capital tracker mechanism due to increased electric system improvements, the base distribution rate increase effective May 1, 2020, and an increase in transmission earnings driven by a higher transmission rate base.

NSTAR Electric's earnings increased $18.7 million for the nine months ended September 30, 2021, as compared to the same period in 2020, due primarily to an increase in transmission earnings driven by a higher transmission rate base and the base distribution rate increase effective January 1, 2021. The earnings increase was partially offset by higher operations and maintenance expense driven by higher employee-related expenses and higher storm restoration costs, higher depreciation expense and higher interest expense.

PSNH's earnings increased $5.1 million for the nine months ended September 30, 2021, as compared to the same period in 2020, due primarily to the base distribution rate increases effective January 1, 2021 and August 1, 2021, an increase in transmission earnings driven by a higher transmission rate base, a lower effective tax rate, and the impact in 2021 of a new tracker mechanism at PSNH approved as part of the 2020 rate settlement agreement. The earnings increase was partially offset by higher operations and maintenance expense, higher depreciation expense and higher property tax expense.

LIQUIDITY

Cash Flows: CL&P had cash flows provided by operating activities of $450.6 million for the nine months ended September 30, 2021, as compared to $399.2 million in the same period of 2020. The increase in operating cash flows was due primarily to the timing of collections for regulatory tracking mechanisms, the timing of other working capital items, and a $10.6 million decrease in income tax payments made in 2021, as compared to 2020. These favorable impacts were partially offset by a $55.7 million increase in pension contributions made in 2021, as compared to 2020, the timing of cash payments made on our accounts payable, cash payments made in 2021 for storm restoration costs of approximately $52 million related to Tropical Storm Isaias, and the timing of cash collections on our accounts receivable.

NSTAR Electric had cash flows provided by operating activities of $617.3 million for the nine months ended September 30, 2021, as compared to $502.6 million in the same period of 2020. The increase in operating cash flows was due primarily to the timing of collections for regulatory tracking mechanisms, income tax refunds received of $7.5 million in 2021, as compared to $39.3 million of income tax payments made in 2020, and the timing of other working capital items. These favorable impacts were partially offset by the timing of cash payments made on our accounts payable, a $9.4 million increase in pension contributions made in 2021, as compared to 2020, and the timing of cash collections on our accounts receivable.

PSNH had cash flows provided by operating activities of ~~$264.0~~$237.2 million for the nine months ended September 30, ~~2017,~~2021, as compared to ~~$306.0~~$149.2 million in the same period of ~~2016.~~2020. The ~~decrease~~increase in operating cash flows was due primarily to the ~~income tax payments~~timing of ~~$11.8~~collections for regulatory tracking mechanisms primarily related to transmission costs, the absence in 2021 of pension contributions of $19.5 million made in ~~2017, compared to the income tax refunds of $41.3 million received in 2016. Partially offsetting this decrease was $16.2 million of lower Pension Plan contributions made in 2017, as compared to 2016,~~2020, and ~~the favorable impacts related to~~ the timing of ~~regulatory recoveries.~~other working capital items. These favorable impacts were partially offset by the timing of cash payments made on our accounts payable.

For further information on CL&P's, NSTAR Electric's and PSNH's liquidity and capital resources, see "Liquidity" and "Business Development and Capital Expenditures" included in this Management's Discussion and Analysis of Financial Condition and Results of Operations.

RESULTS OF OPERATIONS – ~~WESTERN MASSACHUSETTS ELECTRIC~~THE CONNECTICUT LIGHT AND POWER COMPANY

The following provides the amounts and variances in operating revenues and expense line items in the statements of income for ~~WMECO~~CL&P for the ~~nine~~three months ended September 30, ~~2017~~2021 and ~~2016~~2020 included in this combined Quarterly Report on Form 10-Q:


	For the Three Months Ended September 30,
(Millions of Dollars)	2021		2020		Increase/(Decrease)
Operating Revenues	$	919.6	$	994.3	$	(74.7)
Operating Expenses:
Purchased Power and Transmission	392.3		399.1		(6.8)
Operations and Maintenance	137.8		147.5		(9.7)
Depreciation	85.3		80.6		4.7
Amortization of Regulatory Assets, Net	28.9		36.4		(7.5)
Energy Efficiency Programs	35.7		41.8		(6.1)
Taxes Other Than Income Taxes	99.9		97.7		2.2
Total Operating Expenses	779.9		803.1		(23.2)
Operating Income	139.7		191.2		(51.5)
Interest Expense	42.7		38.4		4.3
Other Income, Net	6.9		5.9		1.0
Income Before Income Tax Expense	103.9		158.7		(54.8)
Income Tax Expense	33.7		38.6		(4.9)
Net Income	$	70.2	$	120.1	$	(49.9)

For the Nine Months Ended September 30,
(Millions of Dollars) 2017 2016
Increase/
(Decrease)
Percent
Operating Revenues $ 377.2
$ 368.5
$ 8.7
2.4 %
Operating Expenses:

Purchased Power and Transmission 109.6
104.4
5.2
5.0
Operations and Maintenance 65.8
68.0
(2.2 ) (3.2 )
Depreciation 36.8
34.4
2.4
7.0
Amortization of Regulatory Assets/(Liabilities), Net (0.6 ) 3.3
(3.9 ) (a)
Energy Efficiency Programs 29.7
33.6
(3.9 ) (11.6 )
Taxes Other Than Income Taxes 31.4
30.4
1.0
3.3
Total Operating Expenses 272.7
274.1
(1.4 ) (0.5 )
Operating Income 104.5
94.4
10.1
10.7
Interest Expense 18.8
18.3
0.5
2.7
Other Income, Net 1.4
0.1
1.3
(a)
Income Before Income Tax Expense 87.1
76.2
10.9
14.3
Income Tax Expense 34.7
30.1
4.6
15.3
Net Income $ 52.4
$ 46.1
$ 6.3
13.7 %

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

Operating Revenues

~~WMECO's~~Sales Volumes: CL&P's retail electric GWh sales volumes were ~~as follows:~~5,776 and 5,798 for the three months ended September 30, 2021 and 2020, respectively, resulting in a decrease of 0.4 percent. Fluctuations in retail electric sales volumes do not impact earnings due to its PURA-approved distribution revenue decoupling mechanism.

For the Nine Months Ended September 30,
2017 2016 Decrease Percent
Retail Sales Volumes in GWh 2,579
2,695
(116 ) (4.3 )%

~~WMECO's~~Operating Revenues: Operating Revenues, which consist of base distribution revenues and tracked revenues further described below, ~~increased by $8.7~~decreased $74.7 million for the ~~nine~~three months ended September 30, ~~2017,~~2021, as compared to the same period in ~~2016.~~2020.

Fluctuations in WMECO's sales volumes do not impact the level of base distribution revenue realized or earnings due to the DPU-approved revenue decoupling mechanism. WMECO's revenue decoupling mechanism permits recovery of a base amount of distribution revenues ($132.4 million annually) and breaks the relationship between sales volumes and revenues recognized. The revenue decoupling mechanism results in the recovery of approved base distribution revenue requirements.

Fluctuations in the overall level of operating revenues are primarily related to tracked revenues. Tracked revenues consist of certain costs that are recovered from customers in rates through DPU-approved cost tracking mechanisms and therefore, have no impact on earnings. Costs recovered through cost tracking mechanisms include energy supply procurement and other energy-related costs, retail transmission charges, energy efficiency program costs, low income assistance programs, and restructuring and stranded cost recovery revenues. In addition, certain tracked revenues include incentives earned and carrying charges that are billed in rates to customers. TrackedBase Distribution Revenues: CL&P's distribution revenues decreased due primarily to a decrease in energy supply costs ($10.8 million) driven by decreased average retail prices and lower sales volumes, partially offset by increases in revenues related to renewable energy requirements ($6.6 million).

~~Transmission revenues increased by $12.0~~$9.1 million due primarily to the impact of a base distribution rate decrease implemented on June 1, 2021. The decrease in the base distribution rate was due primarily to the completion of the recovery of ~~higher revenue requirements~~certain storm cost amortization and therefore the base rate decrease did not impact earnings.

Electric distribution revenues also decreased $65 million for the three months ended September 30, 2021, as compared to the same period in 2020, due to CL&P’s settlement agreement on October 1, 2021, in which CL&P agreed to provide a total of $65 million of customer credits to be distributed based on customer sales over a two-month period from December 1, 2021 to January 31, 2022. In the third quarter of 2021, CL&P recorded a current regulatory liability associated with ~~ongoing investments~~the provisions of the settlement agreement, with a $65 million pre-tax charge as a reduction to Operating Revenues. Additionally, CL&P recorded a $28.4 million reserve in the first quarter of 2021 for a civil penalty for non-compliance with storm performance standards that is currently being provided as credits to customer bills beginning on September 1, 2021 over a one-year period. The penalty was reclassified from Operations and Maintenance expense to a reduction of Operating Revenues in the third quarter of 2021 in connection with the finalization of the settlement agreement. For further information, see "Regulatory Developments and Rate Matters - Connecticut" included in this Management’s Discussion and Analysis.

Tracked Revenues: Tracked revenues increased/(decreased) for the three months ended September 30, 2021, as compared to the same period in 2020, due primarily to the following:


(Millions of Dollars)
Retail Tariff Tracked Revenues:
Energy supply procurement	$	(14.5)
Retail transmission	13.5
Other distribution tracking mechanisms	(20.4)
Wholesale Market Sales Revenue	40.3

The decrease in energy supply procurement was driven by lower average prices, partially offset by higher average supply-related sales volumes. Fluctuations in retail transmission revenues are driven by the recovery of the costs of our wholesale transmission business, such as those billed by ISO-NE and Local and Regional Network Service charges. For further information, see "Purchased Power and Transmission Expense" below.

The increase in electric distribution wholesale market sales revenue was due primarily to higher average electricity market prices received for wholesale sales for the three months ended September 30, 2021, as compared to the same period in 2020. ISO-NE average market prices received for CL&P’s wholesale sales increased approximately 100 percent for the three months ended September 30, 2021, as compared to the same period in 2020, driven primarily by higher natural gas prices in New England.Volumes sold into the market were primarily from the sale of output generated by the Millstone PPA that CL&P entered into in 2019, as required by regulation.

Transmission Revenues: Transmission revenues increased $13.9 million due primarily to a higher transmission rate base as a result of continued investment in our transmission infrastructure.

Eliminations: Eliminations are primarily related to transmission revenues derived from ISO-NE regional transmission charges to the distribution business that recover the costs of the wholesale transmission business. The impact of eliminations decreased revenues by $8.5 million.

Purchased Power and Transmission expense includes costs associated with purchasing electricity on behalf of ~~WMECO's customers.~~CL&P's customers and the cost of energy purchase contracts, as required by regulation. These energy supply and other energy-related costs are recovered from customers in ~~rates through DPU-approved~~PURA-approved cost tracking mechanisms, which have no impact on earnings (tracked costs). ~~Total~~ Purchased Power and Transmission expense ~~increased~~decreased for the ~~nine~~three months ended September 30, ~~2017,~~2021, as compared to the same period in ~~2016,~~2020, due primarily to the following:


(Millions of Dollars)
Purchased Power Costs	$	(13.3)
Transmission Costs	14.9
Eliminations	(8.4)
Total Purchased Power and Transmission	$	(6.8)

(Millions of Dollars) Increase/(Decrease)
Purchased Power Costs $ (2.6 )
Transmission Costs 7.8
Total Purchased Power and Transmission $ 5.2

Included in purchased power costs are the costs associated with WMECO's basic service charge and deferred energy supply costs. The basic service charge recovers energy-related costs incurred as a result of providing electric generation service supply to all customers who have not migrated to third party suppliers. The decrease in purchased power costs ~~for the nine months ended September 30, 2017, as compared to the same period in 2016,~~ was due primarily to lower ~~prices associated with~~expense related to the procurement of energy supply ~~and~~resulting from lower average prices, partially offset by higher average supply-related sales volumes. The lower energy supply expense was partially offset by higher long-term contractual energy-related costs that are recovered in the NBFMCC mechanism.

The increase in transmission costs ~~for the nine months ended September 30, 2017, as compared~~was due primarily to ~~the same period in 2016, was primarily the result of~~ an increase in costs billed by ISO-NE that support regional grid ~~investment, and Local Network Service charges, which reflect the cost of transmission service, as well as~~investments. This was partially offset by a decrease in the retail transmission cost deferral, which reflects the actual costs of transmission service compared to estimated amounts billed to customers.

Operations and Maintenance expense includes tracked costs and costs that are part of base distribution rates with changes impacting earnings (non-tracked costs). Operations and Maintenance expense decreased for the ~~nine~~three months ended September 30, ~~2017,~~2021, as compared to the same period in ~~2016, driven by a decrease in non-tracked costs of $1.9 million, which was~~2020, due primarily ~~attributable~~ to lower employee-related expenses, partially offset by higher shared corporate costs. Tracked costs also decreased by $0.3 million, which was primarily attributable to lower tracked employee-related expenses, and a lower deferral adjustment for RECs generated and sold by the ~~WMECO solar program, partially offset by higher transmission expenses.~~following:


(Millions of Dollars)
Base Electric Distribution (Non-Tracked Costs):
CL&P assessment by PURA for Tropical Storm Isaias response; reflected as reduction to Operating Revenues in the third quarter of 2021 in connection with the finalization of the settlement agreement	$	(28.4)
Charge to fund various customer assistance initiatives associated with the settlement agreement on October 1, 2021	10.0
Funding of CL&P storm reserve as part of June 1, 2021 rate change	6.0
Employee-related expenses, including labor and benefits	(7.2)
Storm Restoration Costs	(2.7)
Vegetation management	3.5
Operations-related expenses, including vehicles and outside services	3.4
Other non-tracked operations and maintenance	0.3
Total Base Electric Distribution (Non-Tracked Costs)	(15.1)
Total Tracked Costs	5.4
Total Operations and Maintenance	$	(9.7)

Depreciationexpense increased for the ~~nine~~three months ended September 30, ~~2017,~~2021, as compared to the same period in ~~2016,~~2020, due primarily to a higher ~~utility~~net plant in service ~~balances.~~ balance.

Amortization of Regulatory ~~Assets/(Liabilities),~~Assets, Net expense includes the deferral of energy supply, energy-related costs and other costs that are included in certain regulatory-approved cost tracking mechanisms, and the amortization of certain costs as those costs are collected in rates. This deferral adjusts expense to match the corresponding revenues. Energy supply and energy-related costs are recovered from customers in rates and have no impact on earnings. Amortization of Regulatory Assets, Net decreased for the ~~nine~~three months ended September 30, ~~2017,~~2021, as compared to the same period in ~~2016,~~2020, due to a decrease in storm amortization expense related to the completion of the amortization period of certain storm cost deferred assets. The decrease was partially offset by an increase in the deferral adjustment of energy supply and energy-related costs, which can fluctuate from period to period based on the timing of ~~refunds or recovery~~costs incurred and related rate changes to recover these costs.

Energy Efficiency Programs expenseincludes costs of ~~tracked costs to/~~various state energy policy initiatives and expanded energy efficiency programs that are recovered from customers in ~~rates. These costs~~rates, most of which have no impact on earnings.

Energy Efficiency Programs expensedecreased for the ~~nine~~three months ended September 30, ~~2017,~~2021, as compared to the same period in ~~2016,~~2020, due ~~primarily~~ to the deferral adjustment, which reflects ~~the~~ actual ~~cost~~costs of energy efficiency programs compared to the estimated amounts billed to customers, and the timing of the recovery of energy efficiency costs. The deferral adjusts costs incurred to match energy efficiency revenue billed to customers. The costs for various state policy initiatives are recovered from customers in rates and have no impact on earnings.

Taxes Other Than Income ~~Tax Expense~~Taxes increased for the ~~nine~~three months ended September 30, ~~2017,~~2021, as compared to the same period in ~~2016,~~2020, due primarily to higher property taxes as a result of a higher utility plant balance and higher gross earnings taxes.

Interest Expense increased for the three months ended September 30, 2021, as compared to the same period in 2020, due primarily to higher interest on long-term debt ($2.5 million), a decrease in AFUDC related to debt funds ($1.0 million), and an increase in interest expense on regulatory deferrals ($0.7 million).

Other Income, Net increased for the three months ended September 30, 2021, as compared to the same period in 2020, due primarily to an increase related to pension, SERP and PBOP non-service income components ($3.3 million) and an increase in interest income primarily on regulatory deferrals ($1.0 million), partially offset by a decrease in AFUDC related to equity funds ($1.9 million) and investment losses in 2021 compared to investment income in 2020 driven by market volatility ($1.5 million).

Income Tax Expense decreased for the three months ended September 30, 2021, as compared to the same period in 2020, due primarily to lower pre-tax earnings ($~~3.8~~11.6 million), partially offset by higher state taxes ($4.1 million) and an increase in items that impact our tax rate as a result of regulatory treatment (flow-through items) and permanent differences ($~~0.8~~2.6 million).

EARNINGS SUMMARY

~~WMECO's~~CL&P's earnings ~~increased $6.3~~decreased $49.9 millionfor the ~~nine~~three months ended September 30, ~~2017,~~2021, as compared to the same period in ~~2016,~~2020, due primarily to the settlement agreement on October 1, 2021 resulting in a total $75 million pre-tax charge to earnings. The after-tax impact of the settlement agreement was $63.2 million, or $0.19 per share. Earnings were also unfavorably impacted by a higher effective tax rate, higher depreciation expense, and higher interest expense. The earnings decrease was partially offset by higher earnings from its capital tracker mechanism due to increased electric system improvements and an increase in transmission earnings driven by a higher transmission rate ~~base, and lower operations and maintenance expense.~~base.

~~LIQUIDITY~~

WMECO had cash flows provided by operating activities of $92.0 million for the nine months ended September 30, 2017, as compared to $124.8 million in the same period of 2016. The decrease in operating cash flows was due primarily to the income tax payments of $2.0 million made in 2017, compared to the income tax refunds of $21.6 million received in 2016, and the unfavorable impacts related to the timing of collections and payments of our working capital items, including accounts receivable. Partially offsetting these unfavorable impacts was the benefit related to the timing of regulatory recoveries.ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK


~~ITEM 3.~~	~~QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK~~

Market Risk Information

Commodity Price Risk Management: Our ~~Regulated~~regulated companies enter into energy contracts to serve our customers, and the economic impacts of those contracts are passed on to our customers. Accordingly, the ~~Regulated~~regulated companies have no exposure to loss of future earnings or fair values due to these market risk-sensitive instruments. Eversource's Energy Supply Risk Committee, comprised of senior officers, reviews and approves all ~~large scale~~large-scale energy related transactions entered into by its ~~Regulated~~regulated companies.

Other Risk Management Activities

Interest Rate Risk Management: We manage our interest rate risk exposure in accordance with our written policies and ~~procedures by maintaining a mix of fixed and variable rate long-term debt.~~ procedures.

Credit Risk Management: Credit risk relates to the risk of loss that we would incur as a result of non-performance by counterparties pursuant to the terms of our contractual obligations. We serve a wide variety of customers and transact with suppliers that include IPPs, industrial companies, natural gas and electric utilities, oil and natural gas producers, financial institutions, and other energy marketers. Margin accounts exist within this diverse group, and we realize interest receipts and payments related to balances outstanding in these margin accounts. This wide customer and supplier mix generates a need for a variety of contractual structures, products and terms that, in turn, require us to manage the portfolio of market risk inherent in those transactions in a manner consistent with the parameters established by our risk management process.

Our ~~Regulated~~regulated companies are subject to credit risk from certain long-term or high-volume supply contracts with energy marketing companies. Our ~~Regulated~~regulated companies manage the credit risk with these counterparties in accordance with established credit risk practices and monitor ~~contracting~~contracting risks, including credit risk. As of September 30, ~~2017,~~2021, our ~~Regulated~~regulated companies ~~did not hold~~held collateral (letters of ~~credit)~~credit or cash) of $108.5 million from counterparties related to our standard service contracts. As of September 30, ~~2017,~~2021, Eversource had ~~$24.5~~$34.6 million of cash ~~posted~~posted with ISO-NE related to energy transactions.

We have provided additional disclosures regarding interest rate risk management and credit risk management in Part II, Item 7A, "Quantitative and Qualitative Disclosures about Market Risk," in Eversource's ~~2016~~2020 Form 10-K, which is incorporated herein by reference. There have been no additional risks identified and no material changes with regard to the items previously disclosed in the Eversource ~~2016~~2020 Form 10-K.


~~ITEM 4.~~	~~CONTROLS AND PROCEDURES~~

ITEM 4. CONTROLS AND PROCEDURES

Management, on behalf of Eversource, CL&P, NSTAR Electric ~~PSNH~~ and ~~WMECO,~~PSNH, evaluated the design and operation of the disclosure controls and procedures as of September 30, ~~2017~~2021 to determine whether they are effective in ensuring that the disclosure of required information is made timely and in accordance with the Securities Exchange Act of 1934 and the rules and regulations of the SEC. This evaluation was made under management's supervision and with management's participation, including the principal executive officer and principal financial officer as of the end of the period covered by this Quarterly Report on Form 10-Q. There are inherent limitations of disclosure controls and procedures, including the possibility of human error and the circumventing or overriding of the controls and procedures. Accordingly, even effective disclosure controls and procedures can only provide reasonable assurance of achieving their control objectives. The principal executive officer and principal financial officer have concluded, based on their review, that the disclosure controls and procedures of Eversource, CL&P, NSTAR Electric ~~PSNH~~ and ~~WMECO~~PSNH are effective to ensure that information required to be disclosed by us in reports filed under the Securities Exchange Act of 1934 (i) is recorded, processed, summarized, and reported within the time periods specified in SEC rules and regulations and (ii) is accumulated and communicated to management, including the principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosures.

During the third quarter of 2017, Eversource implemented a new supply chain management system resulting in a material change in internal controls over financial reporting. This new supply chain system consisted of both modern software tools and revised processes that consolidated and standardized all supply chain processes and practices across all of Eversource, including CL&P, NSTAR Electric, PSNH, and WMECO. Pre-implementation testing and post-implementation reviews were conducted by management to ensure that internal controls surrounding the system implementation process, the applications, and the closing process were properly designed to prevent material financial statement errors. Such procedures included the review of required documents, user acceptance testing, change management procedures, access controls, data migration strategies and reconciliations, application interface testing and other standard application controls.

~~Except as described above, there~~There have been no changes in internal controls over financial reporting for Eversource, CL&P, NSTAR Electric ~~PSNH~~ and ~~WMECO~~PSNH during the quarter ended September 30, ~~2017~~2021 that have materially affected, or are reasonably likely to materially affect, internal controls over financial reporting.

PART II. OTHER INFORMATION


~~ITEM 1.~~	~~LEGAL PROCEEDINGS~~

ITEM 1. LEGAL PROCEEDINGS

We are parties to various legal proceedings. We have disclosed ~~these~~certain legal proceedings in Part I, Item 3, "Legal Proceedings," and elsewhere in our ~~2016~~2020 Form 10-K. These disclosures are incorporated herein by reference.

On May 22, 2017, each of the Yankee Companies filed subsequent lawsuits against the DOE in the Court of Federal Claims seeking damages totaling approximately $100 million for CYAPC, YAEC and MYAPC, covering the years from 2013 to 2016 (“DOE Phase IV”). The DOE Phase IV trial is expected to begin in 2018. For a further discussion of the ~~Yankee Companies v. U.S. Department of Energy,~~ ~~see Part I, Item 3, “Legal Proceedings” of our 2016 Form 10-K.~~

~~Other than as set forth above, there~~There have been no ~~additional~~ material legal proceedings identified and no ~~further~~ material changes with regard to the legal proceedings previously disclosed in our ~~2016~~2020 Form 10-K.


~~ITEM 1A.~~	~~RISK FACTORS~~

ITEM 1A. RISK FACTORS

We are subject to a variety of significant risks in addition to the matters set forth under ~~"Forward-Looking Statements,"~~our forward-looking statements section in Item 2, "Management's Discussion and Analysis of Financial Condition and Results of Operations," of this Quarterly Report on Form 10-Q. We have identified a number of these risk factors in Part I, Item 1A, "Risk Factors," in our ~~2016~~2020 Form 10-K, which risk factors are incorporated herein by reference. These risk factors should be considered carefully in evaluating our risk profile. The following risk factor should be read in conjunction

with the risk factors described in the 2020 Form 10-K.

Regulatory, Legislative and Compliance Risks:

The actions of regulators and legislators could result in outcomes that may adversely affect our earnings and liquidity.

The rates that our electric, natural gas and water companies charge their customers are determined by their state regulatory commissions and by the FERC. These commissions also regulate the companies' accounting, operations, the issuance of certain securities and certain other matters. The FERC also regulates the transmission of electric energy, the sale of electric energy at wholesale, accounting, issuance of certain securities and certain other matters, including reliability standards through the North American Electric Reliability Corporation (NERC).

Under state and federal law, our electric, natural gas and water companies are entitled to charge rates that are sufficient to allow them an opportunity to recover their prudently incurred operating and capital costs and a reasonable rate of return on invested capital, to attract needed capital and maintain their financial integrity, while also protecting relevant public interests. Our electric, natural gas and water companies are required to engage in regulatory approval proceedings as a part of the process of establishing the terms and rates for their respective services. Each of these companies prepares and submits periodic rate filings with their respective regulatory commissions for review and approval, which allows for various entities to challenge our current or future rates, structures or mechanisms and could alter or limit the rates we are allowed to charge our customers. These proceedings typically involve multiple parties, including governmental bodies and officials, consumer advocacy groups, and various consumers of energy, who have differing concerns. Any change in rates, including changes in allowed rate of return, are subject to regulatory approval proceedings that can be contentious, lengthy, and subject to appeal. This may lead to uncertainty as to the ultimate result of those proceedings. Established rates are also subject to subsequent prudency reviews by state regulators, whereby various portions of rates could be adjusted, subject to refund or disallowed, including cost recovery mechanisms. The ultimate outcome and timing of regulatory rate proceedings could have a significant effect on our ability to recover costs or earn an adequate return. Adverse decisions in our proceedings could adversely affect our financial position, results of operations and cash flows.

There can be no assurance that regulators will approve the recovery of all costs incurred by our electric, natural gas and water companies, including costs for construction, operation and maintenance, and storm restoration. The inability to recover a significant amount of operating costs could have an adverse effect on a company’s financial position, results of operations and cash flows.

Changes to rates may occur at times different from when costs are incurred. Additionally, catastrophic events at other utilities could result in our regulators and legislators imposing additional requirements that may lead to additional costs for the companies.

In addition to the risk of disallowance of incurred costs, regulators may also impose downward adjustments in a company’s allowed ROE as well as assess penalties and fines. These actions would have an adverse effect on our financial position, results of operations and cash flows.

The FERC has jurisdiction over our transmission costs recovery and our allowed ROEs. Certain outside parties have filed four complaints against all electric companies under the jurisdiction of ISO-NE alleging that our allowed ROEs are unjust and unreasonable. An adverse decision in any of these four complaints could adversely affect our financial position, results of operations and cash flows.

FERC's policy has encouraged competition for transmission projects, even within existing service territories of electric companies. Implementation of FERC's goals, including within our service territories, may expose us to competition for construction of transmission projects, additional regulatory considerations, and potential delay with respect to future transmission projects, which may adversely affect our results of operations and lower rate base growth.

Changes in tax laws, as well as the potential tax effects of business decisions could negatively impact our business, results of operations (including our expected project returns from our planned offshore wind facilities), financial condition and cash flows.

Other than as set forth above, there have been no additional risk factors identified and no material changes with regard to the risk factors previously disclosed in our ~~2016~~2020 Form 10-K.


~~ITEM 2.~~	~~UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS~~

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

The following table discloses purchases of our common shares made by us or on our behalf for the periods shown below. The common shares purchased consist of open market purchases made by the Company or an independent agent. These share transactions related to ~~shares awarded under the Company's Incentive Plan and Dividend Reinvestment Plan and~~ matching contributions under the Eversource 401k Plan.


Period	Total Number of Shares Purchased	Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs	Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans and Programs (at month end)
July 1 - July 31, 2021	—	$	—	—	—
August 1 - August 31, 2021	21	89.05		—	—
September 1 - September 30, 2021	2,377	82.19		—	—
Total	2,398	$	82.25	—	—

Period
Total Number of
Shares Purchased
Average Price
Paid per Share
Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans and Programs (at month end)
July 1 - July 31, 2017 99,090
$ 60.76
—
—
August 1 - August 31, 2017 4,802
62.08
—
—
September 1 - September 30, 2017 74,148
60.77
—
—
Total 178,040
$ 60.80
—
—

ITEM 6. EXHIBITS


~~ITEM 6.~~	~~EXHIBITS~~

Each document described below is filed herewith, unless designated with an asterisk (*), which exhibits are incorporated by reference by the registrant under whose name the exhibit appears.



		Exhibit No.			Description

		Listing of Exhibits (Eversource)
*
4	~~10.1~~		~~Thirteen~~Fifteenth Supplemental Indenture ~~of Mortgage and Deed of Trust~~ between ~~Yankee Gas Services Company~~Eversource Energy and The Bank of New York ~~Mellon~~ Trust Company, N.A., ~~successor~~ as Trustee, ~~to The Bank of New York, as successor to Fleet National Bank (formerly known as The Connecticut National Bank),~~ dated as of ~~September~~August 1, ~~2017~~ 2021, relating to $350 million aggregate principal amount of Floating Rate Senior Notes, Series T, Due 2023 and $300 million aggregate principal amount of Senior Notes, Series U, Due 2026 (Exhibit 4.1, Eversource Energy Current Report on Form 8-K filed on August 13, 2021, File No. 001-05324)

		31		12		~~Ratio of Earnings to Fixed Charges~~

	31	Certification by the Chief Executive Officer of Eversource Energy pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

		31.1		~~31.1~~		Certification by the Chief Financial Officer of Eversource Energy pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

		32		32		Certification by the Chief Executive Officer and Chief Financial Officer of Eversource Energy pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

		Listing of Exhibits (CL&P)

*31	~~4.2~~		Supplemental Indenture (2017 Series A Bonds) between CL&P and Deutsche Bank Trust Company Americas, as Trustee dated as of August 1, 2017 (incorporated by reference to Exhibit 4.1, CL&P Current Report on Form 8-K filed August 23, 2017, File No. 000-00404)

	12	~~Ratio of Earnings to Fixed Charges~~

	31	Certification by the Chairman of The Connecticut Light and Power Company pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

		31.1		~~31.1~~		Certification by the Chief Financial Officer of The Connecticut Light and Power Company pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

		32		32		Certification by the Chairman and the Chief Financial Officer of The Connecticut Light and Power Company pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

		Listing of Exhibits (NSTAR Electric Company)
*		4			Form of 1.95% Debenture due 2031 (Exhibit 4, NSTAR Electric Company Current Report on Form 8-K filed on August 23, 2021, File No. 001-02301)
		12			~~Ratio of Earnings to Fixed Charges~~

31	31		Certification by the Chairman of NSTAR Electric Company pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

		31.1		~~31.1~~		Certification by the Chief Financial Officer of NSTAR Electric Company pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

		32		32		Certification by the Chairman and the Chief Financial Officer of NSTAR Electric Company pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

		Listing of Exhibits (PSNH)

31	12		~~Ratio of Earnings to Fixed Charges~~

	31	Certification by the Chairman of Public Service Company of New Hampshire pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

		31.1		~~31.1~~		Certification by the Chief Financial Officer of Public Service Company of New Hampshire pursuant to Section 302 of the Sarbanes-Oxley Act of 2002




32	32		Certification by the Chairman and the Chief Financial Officer of Public Service Company of New Hampshire pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

		~~Listing of Exhibits (WMECO)~~

	12	~~Ratio of Earnings to Fixed Charges~~

	31	~~Certification by the Chairman of Western Massachusetts Electric Company pursuant to Section 302 of the Sarbanes-Oxley Act of 2002~~

	~~31.1~~	~~Certification by the Chief Financial Officer of Western Massachusetts Electric Company pursuant to Section 302 of the Sarbanes-Oxley Act of 2002~~

	32	Certification by the Chairman and the Chief Financial Officer of Western Massachusetts Electric Company pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

	Listing of Exhibits (Eversource, CL&P, NSTAR Electric, ~~PSNH, WMECO)~~PSNH)
		101.INS
	~~101.INS~~	Inline XBRL Instance Document - the instance document does not appear in the interactive data file because its XBRL tags are embedded within the inline XBRL document

		101.SCH		Inline XBRL Taxonomy Extension Schema

		101.CAL		Inline XBRL Taxonomy Extension Calculation

		101.DEF		Inline XBRL Taxonomy Extension Definition

		101.LAB		Inline XBRL Taxonomy Extension Labels



101.PRE		Inline XBRL Taxonomy Extension Presentation

104	The cover page from the Quarterly Report on Form 10-Q for the quarter ended September 30, 2021, formatted in Inline XBRL

SIGNATURE

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.



	EVERSOURCE ENERGY

November ~~3, 2017~~5, 2021	By:	/s/ Jay S. Buth
		Jay S. Buth
		Vice President, Controller and Chief Accounting Officer

SIGNATURE



	THE CONNECTICUT LIGHT AND POWER COMPANY

November ~~3, 2017~~5, 2021	By:	/s/ Jay S. Buth
		Jay S. Buth
		Vice President, Controller and Chief Accounting Officer

SIGNATURE



	NSTAR ELECTRIC COMPANY

November ~~3, 2017~~5, 2021	By:	/s/ Jay S. Buth
		Jay S. Buth
		Vice President, Controller and Chief Accounting Officer

SIGNATURE



	PUBLIC SERVICE COMPANY OF NEW HAMPSHIRE

November ~~3, 2017~~5, 2021	By:	/s/ Jay S. Buth
		Jay S. Buth
		Vice President, Controller and Chief Accounting Officer

~~SIGNATURE~~



	~~WESTERN MASSACHUSETTS ELECTRIC COMPANY~~

~~November 3, 2017~~	~~By:~~	~~/s/ Jay S. Buth~~
		~~Jay S. Buth~~
		~~Vice President, Controller and Chief Accounting Officer~~



	UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ~~FORM 10-Q~~
x	FORM	10-Q
☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the Quarterly Period Ended	September 30, ~~2017~~2021
	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~~



			Yes			No
			x☒			¨☐



			Yes			No
			x☒			¨☐


			Yes		No

Eversource Energy			~~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~~2021

Eversource Energy Common Shares, $5.00 par value			~~316,885,808~~ 343,805,812	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, and Eversource parent's equity ownership interests that are not consolidated
CL&P		The Connecticut Light and Power Company
NSTAR Electric		NSTAR Electric Company
PSNH		Public Service Company of New Hampshire
~~WMECO~~PSNH Funding		~~Western Massachusetts Electric Company~~PSNH Funding LLC 3, a bankruptcy remote, special purpose, wholly-owned subsidiary of PSNH
NSTAR Gas		NSTAR Gas Company
EGMA		Eversource Gas Company of Massachusetts
Yankee Gas		Yankee Gas Services Company
~~NPT~~Aquarion		Aquarion Company and its subsidiaries
NPT		Northern Pass Transmission LLC
Northern Pass		The ~~HVDC~~high-voltage direct current (HVDC) and associated alternating-current transmission line project from Canada into New Hampshire
HEEC		Harbor Electric Energy Company, a wholly-owned subsidiary of NSTAR Electric
Eversource Service		Eversource Energy Service Company
Bay State Wind		~~A project~~Bay State Wind LLC, an offshore wind business being developed jointly by Eversource and Denmark-based Ørsted ~~(formerly known as DONG Energy) to construct~~
North East Offshore		North East Offshore, LLC, an offshore wind ~~farm off the coast of Massachusetts~~business holding company being developed jointly by Eversource and Denmark-based Ørsted
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 and EGMA, NPT, Aquarion, and the ~~generation activities~~solar power facilities of ~~PSNH and WMECO~~NSTAR Electric
			Regulators and Government Agencies:
~~Regulators:~~BOEM		U.S. Bureau of Ocean Energy Management
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~~ADIT		A project being developed jointly by Eversource, Enbridge, Inc. ("Enbridge"), and National Grid plc ("National Grid") through Algonquin Gas Transmission, LLC 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~~Income
~~Aquarion~~ARO		~~Aquarion Water Company~~
~~ARO~~	Asset Retirement Obligation
Bcf		Billion cubic feet
~~C&LM~~CfD		~~Conservation and Load Management~~
~~CfD~~	Contract for Differences
~~Clean Air Project~~CTA		~~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~~EDIT		Excess Deferred Income Taxes
EPS		Earnings Per Share
ERISA		Employee Retirement Income Security Act of 1974
ESOP		Employee Stock Ownership Plan
~~ESPP~~		~~Employee Share Purchase Plan~~
Eversource ~~2016~~2020 Form 10-K	The Eversource Energy and Subsidiaries ~~2016~~2020 combined Annual Report on Form 10-K as filed with the SEC
~~FERC ALJ~~Fitch		~~FERC Administrative Law Judge~~Fitch Ratings
~~Fitch~~FMCC		~~Fitch Ratings~~
~~FMCC~~	Federally Mandated Congestion Charge
~~FTR~~GAAP		~~Financial Transmission Rights~~
~~GAAP~~	Accounting principles generally accepted in the United States of America
GSC		Generation Service Charge
~~GSRP~~GWh		~~Greater Springfield Reliability Project~~Gigawatt-Hours
~~GWh~~IPP		~~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~~LNG		~~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
~~Moody's~~MMcf		Million cubic feet
Moody's		Moody's Investors Services, Inc.
MW		Megawatt
MWh		Megawatt-Hours
~~NEEWS~~NETOs		~~New England East-West Solution~~
~~NETOs~~	New England Transmission Owners (including Eversource, National Grid and Avangrid)
NOx OCI		~~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~~Power purchase agreement
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~~ROE		~~Regional Network Service~~
~~ROE~~	Return on Equity
~~RRB~~RRBs		Rate Reduction ~~Bond~~Bonds or Rate Reduction ~~Certificate~~Certificates
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~~SS		~~Simplified Incentive Plan~~Standard service
SO₂ UI		~~Sulfur dioxide~~
SS	~~Standard service~~
~~TCAM~~	~~Transmission Cost Adjustment Mechanism~~
~~TSA~~	~~Transmission Service Agreement~~
UI	The United Illuminating Company
VIE		Variable Interest Entity



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

ASSETS
Current Assets:
Cash and Cash Equivalents	$	125,761		$	30,251
Receivables, Net	919,959			847,301
Unbilled Revenues	146,634			168,490
Fuel, Materials, Supplies and Inventory	305,035			328,721
Regulatory Assets	746,142			887,625
Prepayments and Other Current Assets	159,939			215,284
Total Current Assets	2,403,470			2,477,672

Property, Plant and Equipment, Net	22,537,304			21,350,510

Deferred Debits and Other Assets:
Regulatory Assets	3,505,901			3,638,688
Goodwill	3,519,401			3,519,401
Marketable Securities	570,255			544,642
Other Long-Term Assets	627,289			522,260
Total Deferred Debits and Other Assets	8,222,846			8,224,991

Total Assets	$	33,163,620		$	32,053,173

LIABILITIES AND CAPITALIZATION
Current Liabilities:
Notes Payable	$	18,238		$	1,148,500
Long-Term Debt – Current Portion	957,697			773,883
Accounts Payable	794,195			884,521
Obligations to Third Party Suppliers	149,789			122,806
Regulatory Liabilities	170,215			146,787
Other Current Liabilities	530,297			562,108
Total Current Liabilities	2,620,431			3,638,605

Deferred Credits and Other Liabilities:
Accumulated Deferred Income Taxes	6,001,589			5,607,207
Regulatory Liabilities	700,207			702,255
Derivative Liabilities	391,910			413,676
Accrued Pension and SERP	946,629			1,141,514
Other Long-Term Liabilities	881,056			853,260
Total Deferred Credits and Other Liabilities	8,921,391			8,717,912

Capitalization:
Long-Term Debt	10,468,193			8,829,354

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

Equity:
Common Shareholders' Equity:
Common Shares	1,669,392			1,669,392
Capital Surplus, Paid In	6,235,846			6,250,224
Retained Earnings	3,474,185			3,175,171
Accumulated Other Comprehensive Loss	(63,615		)	(65,282		)
Treasury Stock	(317,771		)	(317,771		)
Common Shareholders' Equity	10,998,037			10,711,734
Total Capitalization	21,621,798			19,696,656

Total Liabilities and Capitalization	$	33,163,620		$	32,053,173



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

Operating Activities:
Net Income	$	756,216		$	718,762
Adjustments to Reconcile Net Income to Net Cash Flows Provided by Operating Activities:
Depreciation	571,152			531,781
Deferred Income Taxes	374,863			301,413
Pension, SERP and PBOP Expense, Net	16,891			31,627
Pension and PBOP Contributions	(197,900		)	(121,854		)
Regulatory Overrecoveries, Net	185,952			152,808
Amortization of Regulatory Assets, Net	58,058			56,223
Other	(148,741		)	(27,671		)
Changes in Current Assets and Liabilities:
Receivables and Unbilled Revenues, Net	(107,473		)	(191,454		)
Fuel, Materials, Supplies and Inventory	23,686			25,425
Taxes Receivable/Accrued, Net	88,856			347,898
Accounts Payable	(96,551		)	(121,513		)
Other Current Assets and Liabilities, Net	(32,874		)	(53,077		)
Net Cash Flows Provided by Operating Activities	1,492,135			1,650,368

Investing Activities:
Investments in Property, Plant and Equipment	(1,642,280		)	(1,359,171		)
Proceeds from Sales of Marketable Securities	520,664			444,209
Purchases of Marketable Securities	(506,302		)	(437,197		)
Other Investing Activities	(10,177		)	(9,463		)
Net Cash Flows Used in Investing Activities	(1,638,095		)	(1,361,622		)

Financing Activities:
Cash Dividends on Common Shares	(451,562		)	(423,471		)
Cash Dividends on Preferred Stock	(5,639		)	(5,639		)
Decrease in Notes Payable	(231,500		)	(426,453		)
Issuance of Long-Term Debt	1,250,000			800,000
Retirements of Long-Term Debt	(320,000		)	(200,000		)
Other Financing Activities	171			(17,074		)
Net Cash Flows Provided by/(Used in) Financing Activities	241,470			(272,637		)
Net Increase in Cash and Cash Equivalents	95,510			16,109
Cash and Cash Equivalents - Beginning of Period	30,251			23,947
Cash and Cash Equivalents - End of Period	$	125,761		$	40,056



	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
Eversource	$	196.8	$	200.6	$	126.3	$	119.9
CL&P	77.6		86.4		64.6		67.7
NSTAR Electric	55.7		54.8		32.3		26.2
PSNH	10.6		9.9		—		—
WMECO	17.0		15.5		11.3		9.9



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



Company	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
Various	Surety Bonds⁽²⁾	40.1		2017 - 2018
Eversource Service and Rocky River Realty Company	Lease Payments for Vehicles and Real Estate	8.2		2019 - 2024



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



(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)
Eversource (Millions of Dollars)	Hedging			on Marketable		Defined						Hedging			on Marketable			Defined
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	)

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



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



(Millions of Dollars)	Three Months Ended Increase/(Decrease)			Nine Months Ended Increase/(Decrease)
Electric Distribution	$	(0.4	)	$	(109.1	)
Natural Gas Distribution	7.0			50.1
Transmission	(20.6		)	12.2
Total Purchased Power, Fuel and Transmission	$	(14.0	)	$	(46.8	)



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



(Millions of Dollars)	Increase
Purchased Power and Generation Fuel Costs	$	5.1
Transmission Costs	18.5
Total Purchased Power, Fuel and Transmission	$	23.6