Summary
This 8-K filing from Xcel Energy Inc. (XEL) reports that its wholly-owned subsidiary, Public Service Company of Colorado (PSCo), has filed a request with the Colorado Public Utilities Commission (CPUC) for significant rate increases for both natural gas and steam services. For natural gas, PSCo is seeking an increase of $48.5 million in 2013, followed by subsequent step increases in 2014 and 2015, totaling approximately $72.5 million over three years. This increase is primarily attributed to system investments made since 2010 and rising operating and maintenance expenses, including costs associated with accelerated pipeline integrity efforts. In addition to the base rate adjustments, PSCo is also requesting an extension of its Pipeline System Integrity Adjustment (PSIA) rider mechanism to recover accelerated pipeline renewal costs. For steam services, the requested increases are $1.6 million in 2013, with further increases in 2014 and 2015, driven by higher operating expenses and the need to fund a new boiler to replace retiring electric generation capacity. PSCo is proposing a multi-year rate plan with a stay-out provision and an earnings test through 2015 and a long-term plan to stabilize steam rates by combining gas and steam rate setting starting in 2016.
Key Highlights
- 1Public Service Company of Colorado (PSCo), a subsidiary of Xcel Energy Inc., filed for rate increases with the Colorado Public Utilities Commission (CPUC).
- 2PSCo seeks a $48.5 million increase in Colorado retail natural gas rates for 2013, with additional step increases of $9.9 million in 2014 and $12.1 million in 2015.
- 3The natural gas rate increase is driven by system investments since 2010 and higher operating/maintenance expenses.
- 4An extension of the Pipeline System Integrity Adjustment (PSIA) rider is requested to fund accelerated pipeline integrity efforts, with estimated increases of $26.8 million in 2014 and $24.7 million in 2015.
- 5PSCo also requested a $1.6 million increase in Colorado retail steam rates for 2013, with subsequent increases in 2014 and 2015, to cover operating expenses and a new boiler.
- 6A regulatory plan is proposed, including a stay-out provision and earnings test through 2015, and a consolidation of natural gas and steam rate setting starting in 2016 to stabilize long-term steam rates.