How much will the Marshall Fire settlements cost Xcel Energy?

PSCo expects to pay approximately $640 million in total. About $350 million will be funded by remaining insurance coverage after considering legal costs incurred to date, so the net cost to the company is substantially lower than the gross payment.

Will this settlement affect Xcel Energy's 2025 earnings guidance?

Not on an ongoing basis. The approximately $290 million charge is excluded from ongoing earnings as non-recurring, and management reaffirmed 2025 ongoing EPS guidance of $3.75 to $3.85. However, the charge will reduce reported GAAP net income and EPS for the third quarter of 2025.

Are the settlements final?

Not yet. The agreements in principle remain subject to final documentation and to individual plaintiffs opting in to the settlements negotiated and recommended by their counsel. Until these conditions are met, there is some residual uncertainty about final terms and timing.

Did Xcel Energy admit responsibility for the fire?

No. PSCo did not admit any fault, wrongdoing, or negligence. The company maintains that its equipment did not cause or contribute to the fire and disputes that its equipment was involved in the second ignition that plaintiffs targeted.

Who else is contributing to the settlements?

Telecom defendants Qwest Corporation and Teleport Communications America, LLC are contributing to the settlements, which resolve all claims asserted by subrogation insurers, public entity plaintiffs, and individual plaintiffs.

XEL/XELLL 8-K SEC Disclosure

01—Abstract

Summary

Summary of the 8-K filed September 24, 2025. Cited figures are marked; the original filing is the authoritative source.

Xcel Energy (XEL) disclosed in an 8-K filed September 24, 2025 that its subsidiary Public Service Company of Colorado (PSCo) has reached agreements in principle to settle all remaining litigation arising from the December 2021 Marshall Fire in Boulder County, Colorado.

The settlements resolve claims from subrogation insurers, public entity plaintiffs, and individual plaintiffs. PSCo expects to pay approximately $640 million^a in total, of which roughly $350 million will be funded by remaining insurance coverage, net of legal costs incurred to date. The company expects to record an approximately $290 million pre-tax charge to earnings in the third quarter of 2025, which it will exclude from ongoing earnings as a non-recurring item.

The charge is a material one-time hit to reported (GAAP) results for the quarter, but management reaffirmed its 2025 ongoing EPS guidance of $3.75 to $3.85^b. The agreements remain subject to final documentation and to individual plaintiffs opting in, so closure is not yet certain. Notably, the telecom defendants Qwest and Teleport Communications America are contributing to the settlements, and PSCo did not admit fault while continuing to dispute that its power lines caused the fire.

Plaintiffs had sought billions of dollars in damages tied to a second ignition roughly 80 minutes after the first, which Xcel says was not caused by its equipment. For investors, the key takeaways are that a major overhang is being resolved, that the financial impact is largely covered by insurance, and that the remaining net cost is a one-time charge that does not alter the company's ongoing earnings outlook.

02—Key points

Key Highlights

PSCo expects to pay approximately $640 million to settle all Marshall Fire claims, with about $350 million funded by remaining insurance coverage.
An approximately $290 million charge to earnings is expected in the quarter ending September 30, 2025, treated as a non-recurring adjustment to ongoing earnings.
Settlements cover subrogation insurers, public entity plaintiffs, and individual plaintiffs, and telecom defendants Qwest and Teleport Communications America are contributing.
Xcel Energy reaffirmed its 2025 ongoing EPS guidance of $3.75 to $3.85 per share.
Agreements in principle remain subject to final documentation and individual plaintiffs opting in, so completion is not assured.
PSCo did not admit fault or wrongdoing and continues to dispute that its power lines caused the Marshall Fire.
Ongoing earnings and EPS are non-GAAP measures; the company cannot provide a GAAP reconciliation for its guidance due to unquantifiable future adjustments.

03—Questions

Frequently Asked Questions

How much will the Marshall Fire settlements cost Xcel Energy?
PSCo expects to pay approximately $640 million in total. About $350 million will be funded by remaining insurance coverage after considering legal costs incurred to date, so the net cost to the company is substantially lower than the gross payment.
Will this settlement affect Xcel Energy's 2025 earnings guidance?
Not on an ongoing basis. The approximately $290 million charge is excluded from ongoing earnings as non-recurring, and management reaffirmed 2025 ongoing EPS guidance of $3.75 to $3.85. However, the charge will reduce reported GAAP net income and EPS for the third quarter of 2025.
Are the settlements final?
Not yet. The agreements in principle remain subject to final documentation and to individual plaintiffs opting in to the settlements negotiated and recommended by their counsel. Until these conditions are met, there is some residual uncertainty about final terms and timing.
Did Xcel Energy admit responsibility for the fire?
No. PSCo did not admit any fault, wrongdoing, or negligence. The company maintains that its equipment did not cause or contribute to the fire and disputes that its equipment was involved in the second ignition that plaintiffs targeted.
Who else is contributing to the settlements?
Telecom defendants Qwest Corporation and Teleport Communications America, LLC are contributing to the settlements, which resolve all claims asserted by subrogation insurers, public entity plaintiffs, and individual plaintiffs.

04—Continue

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