Item 8.01 OTHER EVENTS.
Con Edison's utility subsidiaries, CECONY and Orange and Rockland Utilities,
Inc. ("O&R" and together with CECONY, the "Utilities"), have restored electric
service to all of their customers whose service was interrupted by Tropical
Storm Isaias. CECONY and O&R estimate, on a preliminary basis, their incremental
response and restoration costs for Tropical Storm Isaias to be up to $115
million and $35 million, respectively, a majority of which are operating costs.
The Utilities' electric rate plans provide for recovery of operating costs and
capital expenditures under different provisions. The Utilities' incremental
operating costs attributable to storms are to be deferred for recovery as a
regulatory asset under their electric rate plans, while capital expenditures, up
to specified levels, are reflected in rates under their electric rate plans.
On August 19, 2020, the New York State Department of Public Service ("NYDPS")
issued to each of CECONY and O&R a Notice of Apparent Violations Related to
Tropical Storm Isaias. The notices, among other things, assert that, based on
its initial investigations, the Utilities are in apparent violation of the New
York State Public Service Law for allegedly failing to follow the requirements
of their emergency response plans and assert that the New York State Public
Service Commission ("NYSPSC") may seek to commence administrative penalty
proceedings against the Utilities. The Utilities are unable to estimate the
amount of any potential penalty at this time. The notices also provide for
several corrective actions that the Utilities must implement immediately, and
the Utilities are in the process of implementing such actions. The notices
further assert that: the NYSPSC is authorized to revoke or modify utility
certificates to operate based on findings of repeated violations that
demonstrate a failure of a utility corporation to continue to provide safe and
adequate service; the NYSPSC has on other occasions deemed the Utilities'
response to a major storm event to be inadequate; and the NYDPS intends to
specifically determine as part of its ongoing investigations whether the
Utilities' alleged violations warrant revocation of their certificates to
The information in this Current Report on Form 8-K includes forward-looking
statements. Forward-looking statements reflect information available and
assumptions at the time the statements are made, and accordingly speak only as
of that time. Actual results or developments might differ materially from those
included in the forward-looking statements because of various factors including,
but not limited to, those identified in reports Con Edison and CECONY have filed
with the Securities and Exchange Commission.
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