8-KOther Events

XCEL ENERGY INC 8-K Report, Corporate Update (Jun 25, 2015)

Filed June 25, 2015For Securities:XELXELLL

Summary

This 8-K filing by Xcel Energy Inc. (XEL) concerns a significant event for its subsidiary, Southwestern Public Service Company (SPS), in New Mexico. SPS had filed an electric rate case with the New Mexico Public Regulation Commission (NMPRC) seeking a net increase in base rates of $1.4 million, primarily driven by an increase in non-fuel rates offset by a decrease in fuel costs. The filing was based on a forecasted test year and proposed a specific return on equity and rate base. However, on June 24, 2015, the NMPRC verbally dismissed SPS's rate case application during an open meeting. The dismissal was based on a new interpretation of statutory requirements concerning forecasted test year periods and the timing of rate case submissions. A formal written order is still pending. SPS intends to refile the rate case later this year after reviewing the written dismissal order and will consider other strategic options.

Key Highlights

  • 1Southwestern Public Service Company (SPS), a subsidiary of Xcel Energy, filed an electric rate case in New Mexico on June 8, 2015.
  • 2The rate case sought a net increase in base rates of $1.4 million for the New Mexico retail jurisdiction.
  • 3The filing proposed a $31.5 million increase in non-fuel base rates and a $30.1 million decrease in fuel costs.
  • 4The New Mexico Public Regulation Commission (NMPRC) verbally dismissed the rate case application on June 24, 2015.
  • 5The dismissal was due to a new interpretation of statute regarding forecasted test year periods and rate case submission timing.
  • 6SPS plans to refile the rate case later in 2015 after reviewing the written dismissal order.
  • 7Xcel Energy will consider other options following the review of the written order.

Frequently Asked Questions

SPS filed the rate case to seek a net increase in base electric rates of $1.4 million for its New Mexico retail customers. This was achieved by proposing an increase in non-fuel base rates and a decrease in fuel costs.

The NMPRC verbally dismissed the rate case because the filing did not comply with their new interpretation of a statute concerning the timing of rate case submissions when using a forecasted test year.

SPS plans to refile the rate case later in 2015 after reviewing the NMPRC's final written order dismissing the application. Xcel Energy will also evaluate other potential options.

While the filing was dismissed, the actual financial impact in the short term is limited as no new rates were implemented. However, the delay in the rate case means the intended revenue increase from the base rate adjustment is deferred until a successful refiling and approval.