Summary
Xcel Energy Inc. (XEL) filed this 8-K report on April 8, 2009, to provide an update on a rate increase request by its subsidiary, Northern States Power Company (NSP-Minnesota), with the Minnesota Public Utilities Commission (MPUC). NSP-Minnesota initially sought an annual electric rate increase of $156 million (6.05%) based on a 2009 forecast year, a rate base of $4.1 billion, and a requested return on equity (ROE) of 11.00%. The MPUC had previously granted an interim rate increase of $132 million (5.12%) in December 2008. The current filing details the submission of direct testimony by intervenors, including significant recommendations from the Office of Energy Security (OES). The OES proposed a lower revenue increase of $72 million, citing factors like a 10-year life extension for the Prairie Island facility which would reduce depreciation and decommissioning expenses, and adjustments for increased sales and decreased operating costs. The Office of the Attorney General also supported the Prairie Island life extension but did not specify a revenue reduction. The MPUC is expected to issue a final decision in the third quarter of 2009.
Key Highlights
- 1NSP-Minnesota is seeking an annual electric rate increase of $156 million (6.05%) from the MPUC.
- 2An interim rate increase of $132 million (5.12%) was approved by the MPUC effective January 2, 2009.
- 3Intervenors, including the Office of Energy Security (OES), have submitted direct testimony.
- 4The OES recommended a significantly lower revenue increase of $72 million.
- 5Key adjustments proposed by the OES include a $40 million reduction due to the Prairie Island facility's 10-year life extension and associated expense changes.
- 6The Office of the Attorney General also supported the Prairie Island life extension's impact on costs.
- 7A final decision from the MPUC is anticipated in the third quarter of 2009.