Xcel Energy 2009 Annual Report Download - page 23

Minnesota Statutes also allow for recovery of eligible renewable energy investments through a cost recovery rider.
NSP-Minnesota began recovering eligible investments through this mechanism in 2008.
Wind Generation — NSP-Minnesota is investing approximately $900 million over three years for a 201 MW project in
southwestern Minnesota, called the Nobles Wind Project, and a 150 MW project in southeastern North Dakota, called
the Merricourt Wind Project. These projects are expected to be operational by the end of 2010 and 2011, respectively.
In June 2009, the MPUC approved the Nobles and Merricourt Wind Projects. In August 2009, the NDPSC granted
advanced determinations of prudence for the Nobles and Merricourt Wind Projects and a certificate of public
convenience and necessity (CPCN) for the Merricourt Wind project.
NSP-Minnesota Transmission CONs — In April 2009, the MPUC granted a CON to construct three 345 KV electric
transmission lines as part of the CapX 2020 project. The project to build the three lines includes construction of
approximately 600 miles of new facilities at a cost of approximately $1.7 billion. The cost of the project to
NSP-Minnesota and NSP-Wisconsin is estimated to be approximately $900 million. These cost estimates will be revised
after the regulatory process is completed. The MPUC also included a condition assuring a portion of the capacity of
the Brookings, S.D. to Hampton, Minn. line is used for renewable energy. In September 2009, two intervenors
appealed the MPUC’s CON decisions in the Minnesota Court of Appeals.
As part of the regulatory process for the CapX 2020 345 KV projects, NSP-Minnesota and Great River Energy have
filed four route permit applications with the MPUC. Route permit applications for the remaining parts of the three
lines are expected to be filed in adjoining states in 2010. Three filed route permit applications are now in evidentiary
hearing processes before ALJs. The fourth application is expected to be sent to an evidentiary hearing process later in
2010. NSP-Minnesota anticipates the first routing decisions in mid 2010.
As part of CapX 2020, Otter Tail Power Company, Minnesota Power and Minnkota Power Cooperative (on behalf of
themselves and NSP-Minnesota and Great River Energy) filed a CON application in March 2008 for a 230 KV
transmission line between Bemidji and Grand Rapids, Minn. The CON application was approved in July 2009. Route
hearings are scheduled to begin March 30, 2010, and an MPUC decision is anticipated by the third quarter of 2010.
The Bemidji-Grand Rapids line is expected to entail construction of approximately 68 miles of new facilities at a cost
of $100 million, with construction to be completed by the end of 2011. The estimated cost to NSP-Minnesota is
approximately $26 million.
ARCs — In 2009, the FERC adopted rules requiring MISO to allow ARCs to offer demand response aggregation
services to end-use customers in the states served by NSP-Minnesota, unless the applicable state regulatory authority
prohibits ARCs from serving retail customers in their state. ARCs would operate in competition with the state-regulated
retail demand response programs offered by NSP-Minnesota. The MISO ARC tariff provisions are effective in June
2010. The MPUC has opened an investigation regarding possible operation of ARCs in Minnesota. NSP-Minnesota
expects to file requests with the NDPSC and SDPUC by the end of the first quarter of 2010 asking the regulatory
agencies to prohibit operations of ARCs in their respective states, and to take action prior to June 2010.
FCA Investigation — In 2003, the MPUC opened an investigation to consider the continuing usefulness of the FCA
for electric utilities in Minnesota. Continued discussions among utilities, the OES, MOAG and business customers
regarding appropriate FCA reporting detail and provision of additional information to customers is ongoing.
Mercury Reduction and Emissions Reduction Filings — 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.
Nuclear Power Operations and Waste Disposal — NSP-Minnesota owns two nuclear generating plants: the Monticello
plant and the Prairie Island plant, which has two units. See additional discussion regarding the nuclear generating plants
at Note 18 to the consolidated financial statements.
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