Summary
Xcel Energy Inc. (XEL) filed an 8-K on March 31, 2009, to report on the progress of its subsidiary, Southwestern Public Service Company (SPS), in its New Mexico retail electric rate case. SPS had initially requested a $24.6 million, or 6.2%, increase in electric rates based on a historic test year and specific rate base and return on equity assumptions. The company also sought interim rates to recover costs associated with the Lea Power Partners (LPP) facility. The New Mexico Public Regulation Commission (NMPRC) has approved a partial settlement, allowing SPS to recover approximately $5.7 million (75%) of its requested interim LPP costs, starting May 1, 2009, via a rider subject to true-up. A mediator has been appointed to facilitate settlement discussions for the remainder of the case, with a mandatory settlement conference scheduled for April 14-15, 2009. This development indicates a step towards resolution, though the full rate increase is still pending finalization.
Key Highlights
- 1Southwestern Public Service Company (SPS), a subsidiary of Xcel Energy, filed for a $24.6 million (6.2%) electric rate increase in New Mexico.
- 2The rate case filing was based on a historic test year, a rate base of $321 million, and a requested return on equity of 12%.
- 3SPS requested interim rates to recover approximately $7.6 million annually for the Lea Power Partners (LPP) facility.
- 4The New Mexico Public Regulation Commission (NMPRC) approved a partial stipulated settlement on March 26, 2009.
- 5The settlement allows SPS to recover 75% of its interim LPP cost request, totaling approximately $5.7 million per year.
- 6The interim LPP cost recovery will begin May 1, 2009, through a rider and is subject to true-up.
- 7A mediator has been appointed to facilitate settlement for the remaining issues in the rate case, with a mandatory settlement conference scheduled for April 14-15, 2009.