RIDGEWOOD ELECTRIC POWER TRUST I
947 LINWOOD AVENUE
RIDGEWOOD, NEW JERSEY 07450-2939
TEL. (201) 447-9000
May 14, 2001
Securities and Exchange Commission
Washington, D.C. 20549
Dear Commission:
Pursuant to the requirements of the Securities Exchange Act of 1934, we are
transmitting herewith a Quarterly Report on Form 10-Q for the period ended
March 31, 2001.
If you have any questions, please contact the undersigned or our counsel, Daniel
V. Gulino, at this office.
Sincerely,
RIDGEWOOD ELECTRIC POWER TRUST I
/s/Christopher I. Naunton
Christopher I. Naunton, Vice President
and Chief Financial Officer
FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934.
For the quarterly period ended March 31, 2001
Commission file Number 0-24240
RIDGEWOOD ELECTRIC POWER TRUST I
(Exact name of registrant as specified in its charter.)
Delaware 22-3105824
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
947 Linwood Avenue, Ridgewood, New Jersey 07450-2939
(Address of principal executive offices) (Zip Code)
(201) 447-9000
Registrant's telephone number, including area code:
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. YES [X] NO [ ]
PART I. - FINANCIAL INFORMATION
Item 1. Financial Statements
Ridgewood Electric Power Trust I
Financial Statements
March 31, 2001
Ridgewood Electric Power Trust I
Balance Sheet
- --------------------------------------------------------------------------------
March 31, 2001 December 31,
(unaudited) 2000
----------- -----------
Assets:
Investments in power generation projects ......... $ 7,066,383 $ 6,630,024
Cash and cash equivalents ........................ 1,327,543 1,710,744
Other assets ..................................... 14,482 15,592
----------- -----------
Total assets .................................... $ 8,408,408 $ 8,356,360
----------- -----------
Liabilities and Shareholders' Equity:
Liabilities:
Accounts payable and accrued expenses ............ $ 11,928 $ 52,772
Due to affiliates ................................ 118,487 74,836
----------- -----------
Total liabilities ............................... 130,415 127,608
----------- -----------
Commitments and contingencies
Shareholders' equity:
Shareholders' equity (105.5 shares issued and
outstanding) .................................. 8,285,372 8,236,623
Managing shareholder's accumulated deficit ....... (7,379) (7,871)
----------- -----------
Total shareholders' equity ...................... 8,277,993 8,228,752
----------- -----------
Total liabilities and shareholders' equity ...... $ 8,408,408 $ 8,356,360
----------- -----------
See accompanying note to financial statements.
Ridgewood Electric Power Trust I
Statement of Operations (unaudited)
- --------------------------------------------------------------------------------
Three Months Ended March 31,
-----------------------
2001 2000
-------- --------
Revenue:
Income from power generation projects ......... $ 60,692 $430,969
Interest income ............................... 35,585 12,729
-------- --------
Total revenue .............................. 96,277 443,698
-------- --------
Expenses:
Accounting and legal fees ..................... 12,238 10,261
Management fee ................................ 25,693 19,139
Miscellaneous ................................. 9,105 2,860
-------- --------
Total expenses ............................. 47,036 32,260
-------- --------
Net income ....................................... $ 49,241 $411,438
-------- --------
See accompanying note to financial statements.
Ridgewood Electric Power Trust I
Statement of Changes in Shareholders' Equity (unaudited)
- --------------------------------------------------------------------------------
Managing
Shareholders Shareholder Total
----------- ---------- -----------
Shareholders' equity,
December 31, 2000 ............... $8,236,623 $ (7,871) $8,228,752
Net income for the period ........ 48,749 492 49,241
---------- ---------- ----------
Shareholders' equity,
March 31, 2001 .................. $8,285,372 $ (7,379) $8,277,993
---------- ---------- ----------
See accompanying note to financial statements.
Ridgewood Electric Power Trust I
Statement of Cash Flows (unaudited)
- --------------------------------------------------------------------------------
Three Months Ended March 31,
--------------------------
2001 2000
----------- -----------
Cash flows from operating activities:
Net income ................................. $ 49,241 $ 411,438
----------- -----------
Adjustments to reconcile net income
to net cash flows from operating
activities:
Return of investment in power generation
project ................................... -- 46,494
Additional investment in power generation
project ................................... (436,359) --
Changes in assets and liabilities:
Increase in due from affiliates ........... -- (1,111)
Decrease in other assets .................. 1,110 40,323
Decrease in accounts payable and accrued
expenses ................................. (40,844) (32,778)
Increase in due to affiliates ............. 43,651 6,050
----------- -----------
Total adjustments .......................... (432,442) 58,978
----------- -----------
Net cash (used in) provided by
operating activities ..................... (383,201) 470,416
----------- -----------
Cash flows from financing activities:
Cash distributions to shareholders ......... -- (374,083)
----------- -----------
Net cash used in financing activities ...... -- (374,083)
----------- -----------
Net increase in cash and cash equivalents .. (383,201) 96,333
Cash and cash equivalents, beginning of year 1,710,744 1,142,009
----------- -----------
Cash and cash equivalents, end of period ... $ 1,327,543 $ 1,238,342
----------- -----------
See accompanying note to financial statements.
Ridgewood Electric Power Trust I
Note to Financial Statements (unaudited)
1. General
In the opinion of management, the accompanying unaudited financial statements
contain all adjustments, which consist of normal recurring adjustments,
necessary for the fair representation of the results for the interim periods.
Additional footnote disclosure concerning accounting polices and other matters
are disclosed in Ridgewood Electric Power Trust I's financial statements
included in the 2000 Annual Report on Form 10-K, which should be read in
conjunction with these financial statements.
The results of operations for an interim period should not necessarily be taken
as indicative of the results of operations that may be expected for a twelve
month period.
Item 2. Management's Discussion and Analysis of Financial Condition and Results
of OperationsDollar amounts in this discussion are rounded to the nearest
$1,000.
Introduction
The Trust carries its investment in Projects at fair value and does not
consolidate its financial statements with the financial statements of the
Projects. Revenue is recorded by the Trust as cash distributions are received
from the Projects. Trust revenues may fluctuate from period to period depending
on the operating cash flow generated by the Projects and the amount of cash
retained to fund capital expenditures.
Results of Operations
Total revenue decreased 78.3% to $96,000 in the first quarter of 2001 from
$444,000 in the first quarter of 2000, primarily due to the absence of any
income from the Olinda Project in 2001 compared to $374,000 in the first quarter
of 2000. The absence of distributions from the Olinda Project reflects Southern
California Edison Company ("SCE")'s failure to pay the project for power
delivered since November 1, 2000. Interest income increased from $13,000 in the
first quarter of 2000 to $36,000 in the first quarter of 2001 due to higher
interest rates and higher average cash balances.
Total expenses of $47,000 in the first quarter of 2001 were comparable to the
$32,000 incurred in the same period in 2000.
Liquidity and Capital Resources
Obligations of the Trust are generally limited to payment of the management fee
to the Managing Shareholder and payment of certain accounting and legal services
to third parties. The Trust ceased making distributions to shareholders in the
first quarter of 2001.
The Trust anticipates that its cash flow during 2001 will be adequate to fund
its obligations, notwithstanding SCE's financial difficulties.
Forward-looking statement advisory
This Quarterly Report on Form 10-Q, as with some other statements made by the
Trust from time to time, has forward-looking statements. These statements
discuss business trends and other matters relating to the Trust's future results
and the business climate and are found, among other places, in the notes to
financial statements and at Part I, Item 2, Management's Discussion and
Analysis. In order to make these statements, the Trust has had to make
assumptions as to the future. It has also had to make estimates in some cases
about events that have already happened, and to rely on data that may be found
to be inaccurate at a later time. Because these forward-looking statements are
based on assumptions, estimates and changeable data, and because any attempt to
predict the future is subject to other errors, what happens to the Trust in the
future may be materially different from the Trust's statements here.
The Trust therefore warns readers of this document that they should not rely on
these forward-looking statements without considering all of the things that
could make them inaccurate. The Trust's other filings with the Securities and
Exchange Commission and its Confidential Memorandum discuss many (but not all)
of the risks and uncertainties that might affect these forward-looking
statements.
Some of these are changes in political and economic conditions, federal or state
regulatory structures, government taxation, spending and budgetary policies,
government mandates, demand for electricity and thermal energy, the ability of
customers to pay for energy received, supplies of fuel and prices of fuels,
operational status of plant, mechanical breakdowns, availability of labor and
the willingness of electric utilities to perform existing power purchase
agreements in good faith. Some of the cautionary factors that readers should
consider are described in the Trust's most recent Annual Report on Form 10-K.
By making these statements now, the Trust is not making any commitment to revise
these forward-looking statements to reflect events that happen after the date of
this document or to reflect unanticipated future events.
PART II - OTHER INFORMATION
Item 1. Legal Proceedings
As reported more fully in Form 10-K filed by the Trust for the year
ended December 31, 2000, Brea Power Partners, L.P. ("Brea") entered into a
long-term power purchase and sale agreement with Southern California Edison
Company ("SCE"), which terminates on March 23, 2005. On January 16, 2001, as a
result of the deregulation of the electric industry in California and its
precarious financial position, SCE, in an effort to conserve what little cash it
possessed, sent the Qualifying Facilities under contract with it, including the
Olinda Project (which is owned by Brea), a letter informing them that it was
temporarily suspending payments to Qualifying Facilities. SCE has not paid the
Olinda Project for energy and capacity delivered to SCE for the months of
November and December, 2000, January, February and March 2001. However, on March
27, 2001, the California Public Utilities Commission ("CPUC") ordered, among
other things, that electric utilities in California pay on a going forward basis
for power delivered by Qualifying Facilities. Since such order, SCE has paid
Brea for the electric power produced and delivered from March 27, 2001 through
April 30, 2001. However, given the developing and continuing crisis in
California, there is no guarantee that such going forward payments will
continue. Moreover, despite going forward payments, SCE has not paid amounts due
to Brea for the months of November 2000 - March 2001.
As a result, on April 5, 2001, Brea filed a lawsuit against SCE in the
Superior Court of the State of California, County of Los Angeles, seeking
damages of not less than $12 million based upon, among other things, SCE's
breach of contract for failing to make full payment for November, 2000 - March,
2001 deliveries. Brea's lawsuit is but one of at least twelve similar lawsuits
filed against SCE. As of this date, there is pending a motion filed by SCE to
consolidate theses cases for purposes of discovery. Although the Trust believes
that its position in the lawsuit is based on solid legal theory, it is difficult
to assess the possible outcome of the lawsuit for reasons other than legal
theory. For example, the CPUC, Federal Energy Regulatory Commission, the State
of California and, additionally, the United States Government all have expressed
a desire to assist in resolving the California energy crisis and each entity has
jurisdiction over some, but possibly not all, of the issues that need to be
resolved. In addition, on April 6, 2001, Pacific Gas and Electric Company
("PG&E") sought protection from creditors under Chapter 11 of the Bankruptcy
Code and, as a result, certain actions of the Bankruptcy Court in the PG&E case
may impact SCE. Finally, there is no guarantee that SCE may not itself declare
bankruptcy, in which case SCE could reject the contract with Brea. Therefore,
the Trust can not speculate as to the most likely outcome and, the impact, if
any, such outcome will have on Brea, its contract with SCE or its filed lawsuit.
SIGNATURES
Pursuant to the requirement of the Securities Exchange Act of 1934, the
registrant as duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
RIDGEWOOD ELECTRIC POWER TRUST I
Registrant
May 14, 2001 By /s/ Christopher I. Naunton
Date Christopher I. Naunton
Vice President and
Chief Financial Officer
(signing on behalf of the
Registrant and as
principal financial
officer)