Xcel Energy 2009 Annual Report Download - page 26

Nuclear — NSP-Minnesota secures contracts for uranium concentrates, uranium conversion, uranium enrichment and
fuel fabrication for the operation of its nuclear generation plants. The contract strategy involves a portfolio of spot
purchases and medium and long-term contracts for uranium, conversion and enrichment with multiple producers to
minimize potential impacts caused by supply interruptions due to geographical and world political issues.
• Current nuclear fuel supply contracts cover 100 percent of uranium concentrates requirements through 2010,
approximately 85 percent of the requirements for 2011 through 2014, and 49 percent of the requirements for
2015 through 2017, with no arrangements for 2018 and beyond. Contracts for additional uranium concentrate
supplies are currently in various stages of negotiations that are expected to provide a portion of the remaining
open requirements through 2025.
• Current contracts for conversion services cover 100 percent of the requirements through 2011 and approximately
70 percent of the requirements from 2012 through 2016, with no arrangements for 2017 and beyond. Contracts
for additional conversion services are being evaluated and negotiated to provide a portion of remaining open
requirements for 2014 and beyond.
• Current enrichment services contracts cover 100 percent of 2010 through 2013 requirements. Contracts for
additional enrichment services are being evaluated and negotiated to provide a portion of the remaining open
requirements for 2014 and beyond.
• Fabrication services for Monticello are covered through 2011. Responses from fuel fabrication vendors to our
RFPs for additional supply for Monticello are being reviewed with plans to enter into a contract with one of the
vendors in 2010. Prairie Island’s fuel fabrication is 100 percent committed through 2014.
NSP-Minnesota expects sufficient uranium, conversion and enrichment to be available for the total fuel requirements of
its nuclear generating plants. Some exposure to price volatility will remain, due to index-based pricing structures on the
contracts.
Natural gas — The NSP System uses both firm and interruptible natural gas and standby oil in combustion turbines
and certain boilers. Natural gas supplies and associated transportation and storage services for power plants are procured
under contracts with various terms to provide an adequate supply of fuel. The supply, transportation and storage
contracts expire in various years from 2010 to 2028. Certain natural gas supply and transportation agreements include
obligations for the purchase and/or delivery of specified volumes of natural gas or to make payments in lieu of delivery.
At Dec. 31, 2009, NSP-Minnesota’s commitments related to supply contracts were $53 million and commitments
related to transportation and storage contracts were approximately $538 million. The NSP System has limited on-site
fuel oil storage facilities and relies on the spot market for incremental supplies, if needed.
Wholesale Commodity Marketing Operations
NSP-Minnesota conducts various wholesale marketing operations, including the purchase and sale of electric capacity,
energy and energy related products. NSP-Minnesota uses physical and financial instruments to reduce commodity price
and credit risk and hedge supplies and purchases. See additional discussion under Item 7A — Quantitative and
Qualitative Disclosures about Market Risk.
NSP-Wisconsin
Public Utility Regulation
Summary of Regulatory Agencies and Areas of Jurisdiction — Retail rates, services and other aspects of NSP-Wisconsin’s
operations are regulated by the PSCW and the MPSC, within their respective states. In addition, each of the state
commissions certifies the need for new generating plants and electric transmission lines before the facilities may be sited
and built. NSP-Wisconsin is subject to the jurisdiction of the FERC with respect to its wholesale electric operations,
hydroelectric generation licensing, accounting practices, wholesale sales for resale the transmission of electricity in
interstate commerce and certain natural gas transactions in interstate commerce. NSP-Wisconsin has received
authorization from the FERC to make wholesale electric sales at market-based prices (see Market Based Rate Rules
discussion) and is a transmission-owning member of the MISO RTO.
The PSCW has a biennial base-rate filing requirement. By June of each odd-numbered year, NSP-Wisconsin must
submit a rate filing for the test year beginning the following January.
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