Xcel Energy 2009 Annual Report Download - page 139

Pending and Recently Concluded Regulatory Proceedings — FERC
Pacific Northwest FERC Refund Proceeding — In July 2001, the FERC ordered a preliminary hearing to determine
whether there may have been unjust and unreasonable charges for spot market bilateral sales in the Pacific Northwest
for the period Dec. 25, 2000 through June 20, 2001. PSCo supplied energy to the Pacific Northwest markets during
this period and has been a participant in the hearings. In September 2001, the presiding ALJ concluded that prices in
the Pacific Northwest during the referenced period were the result of a number of factors, including the shortage of
supply, excess demand, drought and increased natural gas prices. Under these circumstances, the ALJ concluded that the
prices in the Pacific Northwest markets were not unreasonable or unjust and no refunds should be ordered. Subsequent
to the ruling, the FERC has allowed the parties to request additional evidence. Parties have claimed that the total
amount of transactions with PSCo subject to refund is $34 million. In June 2003, the FERC issued an order
terminating the proceeding without ordering further proceedings. Certain purchasers filed appeals of the FERC’s orders
in this proceeding with the U. S. Court of Appeals for the Ninth Circuit.
In an order issued in August 2007, the Court of Appeals remanded the proceeding back to the FERC. The Court of
Appeals also indicated that the FERC should consider other rulings addressing overcharges in the California organized
markets. The Court of Appeals denied a petition for rehearing in April 2009, and the mandate was issued. The FERC
has yet to act on this order on remand; currently, certain motions concerning procedures on remand are pending before
the FERC.
Wholesale Rate Case — In 2009, PSCo proposed to increase Colorado wholesale rates by $30 million based on a
12.5 percent ROE, a 58 percent equity ratio and an electric production rate base of $315 million. PSCo has requested
that FERC suspend action on the filing to allow time for settlement negotiations. Settlement discussions with PSCo’s
wholesale customers are continuing. PSCo expects rates subject to refund to go into effect in the second quarter of
2010.
SPS
Pending and Recently Concluded Regulatory Proceedings — PUCT
Base Rate
Texas Retail Base Rate Case — In June 2008, SPS filed a rate case with the PUCT seeking an annual rate increase of
approximately $61.3 million, or approximately 5.9 percent. Base revenues are proposed to increase by $94.4 million,
while fuel and purchased power revenue would decline by $33.1 million, primarily due to fuel savings from the Lea
Power Partners (LPP) purchase power agreement. The rate filing was based on a 2007 test year adjusted for known and
measurable changes, a requested ROE of 11.25 percent, an electric rate base of $989.4 million and an equity ratio of
51.0 percent. Interim rates of $18 million for costs associated with the LPP power purchase agreement went into effect
in September 2008.
In January 2009, a settlement agreement was reached with various intervenors, which provided for a base rate increase
of $57.4 million, a reduced depreciation expense of $5.6 million, allowed SPS to implement the transmission rider in
2009 and precludes SPS from filing to seek any other change in base rates until Feb. 15, 2010. In January 2009, an
ALJ approved interim rates effective February 2009. On June 2, 2009, the PUCT issued its order approving the
settlement.
John Deere Wind Complaint — In June 2007, several John Deere Wind Energy subsidiaries (JD Wind) filed a
complaint against SPS disputing SPS’ payments for energy produced from the JD Wind projects. SPS responded that
the payments to JD Wind are appropriate and in accordance with SPS’ filed tariffs. In March 2009, the ALJ
recommended that SPS payment methodology to JD Wind is proper and that JD Wind’s complaint be denied.
In May 2009 the PUCT issued a final order denying JD Wind’s request for relief against SPS. In June 2009, JD Wind
filed a petition for review of the final order in Texas District Court. In July 2009, the PUCT filed an answer to JD
Wind’s petition in Texas District Court in which the PUCT denied all allegations contained in the JD Wind petition.
The case is pending in Texas District Court.
In November 2009, the FERC declined to rule on a request to overturn the PUCT decision by JD Wind but did issue
a declaratory order stating that the PUCT’s order denying JD Wind’s complaint is not consistent with the FERC’s
regulations. In December 2009, SPS requested that the FERC reconsider its November 2009 declaratory order. In
December 2009, JD Wind filed a complaint against the PUCT in U. S. District Court seeking federal law
enforcement, including declaratory and injunctive relief to enforce and give proper effect to the PURPA. JD Wind
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