Xcel Energy 2009 Annual Report Download - page 134

Mercury Cost Rider — The MPUC has approved mercury control plans for reducing mercury emissions at the Sherco
Unit 3 and A. S. King plants. A sorbent injection control system was put into service at Sherco Unit 3 in December
2009, with installation at A. S. King scheduled to be completed in December 2010. Currently, the estimated project
costs are approximately $6.6 million for these two units, and the MPUC authorized NSP-Minnesota to collect the
2010 revenue requirement associated with these projects, which is approximately $3.5 million from customers through a
mercury rider in 2010. On Dec. 21, 2009, NSP-Minnesota filed the plans for mercury control at Sherco Units 1 and 2
with the MPUC and MPCA. Assuming these plans are approved, NSP-Minnesota expects to file for recovery of the
costs to implement these plans through the mercury cost rider. The plan proposes a flexible program of testing and
monitoring as new technology emerges and federal regulations change over the next several years. The plan calls for the
addition of sorbent injection by the statutory deadline of the end of 2014. The MPCA has six months to review the
plan.
SEP Rider — In September 2009, the MPUC approved NSP-Minnesota proposed rider to recover approximately
$2.5 million from its electric customers and $0.1 million from its natural gas customers to recover costs related to SEP
mandates and a cast iron natural gas pipe replacement project to reduce GHG emissions. The revised SEP rate recovery
factors were placed into effect in October 2009.
Energy Innovation Corridor (EIC) Initiative — In December 2009, NSP-Minnesota filed a request with the MPUC
for approval of specific projects totaling $15 million including a $2 million deferral request. The EIC initiative will be
a first-of-its-kind clean energy and transportation model in an established urban center in the upper Midwest. The
2009 legislation authorized rider cost recovery for MPUC approved projects, including NSP-Minnesota’s costs to
relocate its facilities along the transportation corridor. Rider cost recovery is also authorized for MPUC approved EIC
projects that demonstrate the best energy efficiency management practices and the installation of innovative and
sustainable energy technologies and programs for transforming a mature urban center into a national model for the
future development of transportation and energy corridors. The EIC initiative will advance critical local, state, regional
and federal efforts to invest in energy efficiency, transportation electrification, renewable energy and smart grid
technology. MPUC action is pending.
Annual Automatic Adjustment Report for 2007/2008 — In September 2008, NSP-Minnesota filed its annual automatic
adjustment reports for July 1, 2007 through June 30, 2008. During that time period, $848.5 million in fuel and
purchased energy costs, including $258.8 million of MISO charges, were recovered from Minnesota electric customers
through the FCA. In addition, approximately $680 million of purchased natural gas and transportation costs were
recovered through the PGA. In February 2010, the MPUC voted to accept the 2008 natural gas annual automatic
adjustment report.
Annual Automatic Adjustment Report for 2008/2009 — In September 2009, NSP-Minnesota filed its annual automatic
adjustment reports for July 1, 2008 through June 30, 2009. During that time period, $803.6 million in fuel and
purchased energy costs were recovered from Minnesota electric customers through the FCA. In addition, approximately
$499.4 million of purchased natural gas and transportation costs were recovered through the PGA. Comments are due
in May 2010 on NSP-Minnesota’s 2008/2009 electric and natural gas annual automatic adjustment reports. The request
is pending MPUC action.
Conservation Incentive Filing — In July 2009, NSP-Minnesota filed its proposed incentive plan for achieving
significantly higher DSM goals. The incentive would allow for sharing of savings of up to 15 percent of the net present
value of benefits, depending on the level of savings achieved. In December 2009, the MPUC approved the proposed
shared savings model. The plan would allow NSP-Minnesota to earn a higher incentive than under the previous
method if it achieves the higher goals established by the OES. The amount of the incentive increases to the extent that
NSP-Minnesota cost-effectively exceeds the goal. A written order was issued in January 2010.
Gas Meter Module Failures — Approximately 8,700 customers in the St. Cloud and East Grand Forks areas of
Minnesota and about 4,000 customers in the Fargo, N.D. area were under billed for a period of time during the
2007-2008 heating season due to the failure of the automated meter reading (AMR) module installed on their natural
gas meters. While the modules failed to register usage, the meters continued to function.
Pursuant to the NDPSC-approved plan, which provided customers with a $50 service quality credit for each customer
experiencing a module failure, NSP-Minnesota began implementing the service quality credits and the rebilling of
remaining North Dakota customers in June 2009. In total, NSP-Minnesota rebilled North Dakota customers
approximately $1.5 million for the estimated gas usage during the module failure period.
124