Summary
Xcel Energy Inc. (XEL) reported via an 8-K filing on December 30, 2011, that its wholly-owned subsidiary, Southwestern Public Service Company (SPS), reached a settlement agreement approved by the New Mexico Public Regulation Commission (NMPRC) regarding electric rate increases. The settlement, which resolves a rate filing made in February 2011 seeking a $19.9 million increase, allows for a base rate increase of $13.5 million, effective January 1, 2012. This settlement establishes a "Settlement Period" during which SPS has agreed not to file another base rate case until December 3, 2012, with new final rates from that case not becoming effective until January 1, 2014. While base rates are fixed during this period, certain adjustments will still apply, including the fuel adjustment clause, energy efficiency programs, renewable portfolio standard regulatory asset costs, and actual environmental regulation costs incurred after December 31, 2010. This resolution provides a degree of rate stability for customers in New Mexico while allowing Xcel Energy to recover a portion of its requested revenue.
Key Highlights
- 1Southwestern Public Service Company (SPS), a subsidiary of Xcel Energy, received approval for an electric rate increase in New Mexico.
- 2The approved base rate increase amounts to $13.5 million, down from the initially requested $19.9 million.
- 3New rates approved by the New Mexico Public Regulation Commission (NMPRC) will be effective starting January 1, 2012.
- 4A settlement agreement restricts SPS from filing another base rate case until December 3, 2012.
- 5New final rates from the next case will not be effective until January 1, 2014, providing rate stability for the "Settlement Period."
- 6Key exceptions to fixed rates during the settlement period include the fuel adjustment clause and costs related to energy efficiency, renewable portfolio standards, and certain environmental regulations.