Xcel Energy 2011 Annual Report Download - page 123

113
(Thousands of Dollars) Jan. 1, 2010 Purchases Settlements
Gains
Recognized as
Regulatory
Assets and
Liabilities Dec. 31, 2010
Asset-backed securities .............. $
11,918 $ 38,871 $ (17,878) $ 263 $ 33,174
Mortgage-backed securities........... 81,189 63,497 (75,701) 3,604 72,589
Total ............................. $ 93,107 $ 102,368 (93,579) $ 3,867 $ 105,763
(Thousands of Dollars) Jan. 1, 2009 Purchases Settlements
Gains
Recognized as
Regulatory
Assets and
Liabilities Dec. 31, 2009
Asset-backed securities .............. $
10,962 $ 7,271 $ (7,755) $ 1,440 $ 11,918
Mortgage-backed securities........... 98,461 17,943 (45,815) 10,600 81,189
Total ............................. $ 109,423 $ 25,214 (53,570) $ 12,040 $ 93,107
The following table summarizes the final contractual maturity dates of the debt securities in the nuclear decommissioning fund,
by asset class, at Dec. 31, 2011:
Final Contractual Maturity
(Thousands of Dollars)
Due in 1 Year
or Less
Due in 1 to 5
Years
Due in 5 to 10
Years
Due after 10
Years Total
Government securities .................. $ 113,179 $ - $ 4,077 $ - $ 117,256
U.S. corporate bonds.................... 304 35,437 139,880 17,895 193,516
International corporate bonds ............
- 8,454 23,501 3,849 35,804
Municipal bonds........................
- - 40,585 24,146 64,731
Asset-backed securities ................. - 9,907 6,594 - 16,501
Mortgage-backed securities..............
- 1,731 1,041 75,892 78,664
Debt securities ....................... $ 113,483 $ 55,529 $ 215,678 $ 121,782 $ 506,472
Derivative Instruments Fair Value Measurements
Xcel Energy enters into derivative instruments, including forward contracts, futures, swaps and options, for trading purposes and
to reduce risk in connection with changes in interest rates, utility commodity prices and vehicle fuel prices, as well as variances in
forecasted weather.
Interest Rate Derivatives — Xcel Energy enters into various instruments that effectively fix the interest payments on certain
floating rate debt obligations or effectively fix the yield or price on a specified benchmark interest rate for an anticipated debt
issuance for a specific period. These derivative instruments are generally designated as cash flow hedges for accounting purposes.
At Dec. 31, 2011, accumulated OCI related to interest rate derivatives included $0.9 million of net losses expected to be
reclassified into earnings during the next 12 months as the related hedged interest rate transactions impact earnings.
At Dec. 31, 2011, Xcel Energy had unsettled interest rate swaps outstanding with a notional amount of $475 million. These
interest rate swaps were designated as hedges, and as such, changes in fair value are recorded to OCI. In addition, Xcel Energy
entered into interest rate swaps with a notional amount of $175 million during the year which were settled in conjunction with the
Xcel Energy Inc. debt issuance in September 2011. See Note 4 for further discussions of long-term borrowings.
Short-Term Wholesale and Commodity Trading Risk — Xcel Energy conducts various short-term wholesale and commodity
trading activities, including the purchase and sale of electric capacity, energy and energy-related instruments. Xcel Energy’s risk
management policy allows management to conduct these activities within guidelines and limitations as approved by its risk
management committee, which is made up of management personnel not directly involved in the activities governed by this
policy.
Commodity Derivatives — Xcel Energy enters into derivative instruments to manage variability of future cash flows from
changes in commodity prices in its electric and natural gas operations, as well as for trading purposes. This could include the
purchase or sale of energy or energy-related products, natural gas to generate electric energy, gas for resale and vehicle fuel.
$
$