Question-and-Answer Session
Operator
(Operator Instructions). Our first question comes from Robert Chewning - Davenport & Company.
Robert Chewning - Davenport & Company
If I look at the quarter, even taking out the I think $0.03 of reversal on interest expense, it looked to be a lot lower than your run rate prior to the quarter; and I was wondering what else might have been in there. And secondly, if you can give guidance for 2008 in terms of where interest should be gross and also net of AFUDC on debt.
Kathleen Nolen
You are asking a comparison for the quarter. AFUDC, which was a major item for the quarter-over-quarter on run rate, that’s about $0.15. The next largest item was the corporate owned life insurance proceeds; it’s about $0.09 on the 2006 quarter, one there on the 2007 quarter. And then we have some higher expenses at both Power and corporate. Is that what you are asking, Bob?
Robert Chewning - Davenport & Company
No. If I look at interest expenses on a quarterly basis, they were averaging roughly $14 million a quarter.
Kathleen Nolen
Okay. You are specifically looking at interest?
Robert Chewning - Davenport & Company
Yes.
Kathleen Nolen
That is the reversal of our interest accruals we had on an uncertain tax position.
Robert Chewning - Davenport & Company
Okay. But would that explain all of it? Even if I take that out, it would appear to have been a little bit low. And the more pertinent question is what should be the run rate for interest in 2008? And I realize that you have securitization interest expense that will be in there. You are also going to have additional debt financing. Where should that be coming out in 2008?
Kathleen Nolen
Your quarterly effect from your unwind of the tax position was really about $0.04. It was most of your interest movement for the quarter, Bob.
Robert Chewning - Davenport & Company
Okay.
Kathleen Nolen
If you look forward to 2008, you are going to have the interest on the securitization bonds that will be part of a special purpose entity, although it will consolidate from a GAAP standpoint. And we are looking at additional financing, and I’d say very roughly perhaps in the $200 million range by the end of the second quarter, and you can look to interest costs there.
Robert Chewning - Davenport & Company
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