Question-and-Answer Session
(Operator Instructions) Your first question comes from Paul Patterson – Glenrock Associates.
Paul Patterson – Glenrock Associates
Good morning, guys. The mark-to-market gains, how do we model that going forward? What is the expectation in the 2007 numbers for any mark-to-market adjustments? Do you expect any of those to reverse out? What is the expectation for that, since it was a big of a driver this quarter?
Ralph Izzo
It was a bit of a driver this quarter. It does move around, I think over the long run it is expected to be zero, to be honest. If you just go back, even in the first couple of quarters, the first quarter of this year it was down $0.07; the second quarter it was positive $0.06 so halfway through the year we are basically at zero. We were $0.17 up this year, the biggest part of that was Texas. It is one of the few contracts we mark-to-market.
As I said, about one-third of that is based on quarter end forward prices we expect to reverse.
Tom O'Flynn
Just in terms of our contracts, really the majority of our activities are either hedge accounting, which is not mark-to-market, or get normal purchase and sale. That is for the majority of our contracts at Power and most of our contracts at Holdings. The one major exception we have is a long-term contract we’ve got for 250 megawatts for four-and-a-half more years at Texas.
Ralph Izzo
In the long run, Paul, I think it is going to move around quarter to quarter, but as we think about our business going forward, it is a net neutral.
Paul Patterson – Glenrock Associates
Weather versus normal, you had mentioned what it was versus the year-over-year, but what is it versus normal? Do you have a rough idea of the last nine months how much weather has contributed?
Tom O'Flynn
The last nine months were below normal by about $0.12. About two-thirds of that is gas.
Paul Patterson – Glenrock Associates
So about $0.12 a share is lower than what normal weather would have brought in?
Tom O'Flynn
Yes, and that is largely gas from January/February.
Paul Patterson – Glenrock Associates
Finally, when is the settlement effective? I know you probably mentioned it, but somehow I got distracted when you were talking about it. When does the settlement become effective after the BPU rules on it?
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