Summary
This Form 8-K filing from Xcel Energy Inc. (XEL) on May 29, 2009, primarily details the ongoing rate increase proceedings for its wholly-owned subsidiary, Northern States Power Company (NSP-Minnesota), with the Minnesota Public Utilities Commission (MPUC). NSP-Minnesota initially requested a $156 million annual electric rate increase based on a 2009 forecast test year and a 6.05% rate hike. An interim rate increase of $132 million was approved in December 2008, effective January 2009, which was lower than requested due to a difference in the authorized versus requested Return on Equity (ROE).
Key Highlights
- 1NSP-Minnesota initially requested a $156 million (6.05%) annual electric rate increase, with the MPUC approving an interim increase of $132 million (5.12%) effective January 2, 2009.
- 2Key differences in the rate case revolve around the authorized Return on Equity (ROE) and the treatment of expenses related to the Prairie Island nuclear plant's life extension.
- 3Intervenors, including the Office of Energy Security (OES) and the Office of the Attorney General (OAG), have submitted testimony recommending lower revenue increases than initially requested.
- 4NSP-Minnesota revised its request downwards to $138 million, citing cost reductions in commodities, management initiatives, and lower projected capacity costs.
- 5The Prairie Island nuclear plant's life extension is a significant factor, with different proposals for recognizing the resulting decrease in depreciation and decommissioning expenses.
- 6The OAG has recommended disallowances for certain expenses and the use of different allocators for corporate costs, further impacting the potential revenue increase.
- 7A final decision from the MPUC on the rate increase is anticipated in the third quarter of 2009.