Xcel Energy 2011 Annual Report Download - page 17

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The management of the electric production and transmission system of NSP-Wisconsin is integrated with NSP-Minnesota.
NSP-Wisconsin owns the following direct subsidiaries: Chippewa and Flambeau Improvement Co., which operates hydro
reservoirs; Clearwater Investments Inc., which owns interests in affordable housing; and NSP Lands, Inc., which holds real estate.
PSCo
PSCo is an operating utility engaged primarily in the generation, purchase, transmission, distribution and sale of electricity in
Colorado. The wholesale customers served by PSCo comprised approximately 19 percent of its total KWh sold in 2011. PSCo
also purchases, transports, distributes and sells natural gas to retail customers and transports customer-owned natural gas. PSCo
provides electric utility service to approximately 1.4 million customers and natural gas utility service to approximately 1.3 million
customers. All of PSCo’s retail electric operating revenues were derived from operations in Colorado during 2011. Although
PSCo’s large commercial and industrial electric retail customers are comprised of many diversified industries, a significant
portion of PSCo’s large commercial and industrial electric sales include customers in the following industries: fabricated metal
products, as well as electric and gas services. For small commercial and industrial customers, significant electric retail sales
include customers in the following industries: real estate and dining establishments. Generally, PSCo’s earnings contribute
approximately 45 percent to 55 percent of Xcel Energy’s consolidated net income.
PSCo owns the following direct subsidiaries: 1480 Welton, Inc. and United Water Company, both of which own certain real
estate interests; and Green and Clear Lakes Company, which owns water rights and certain real estate interests. PSCo also owns
PSRI, which held certain former employees’ life insurance policies. Following settlement with the IRS during 2007, such policies
were terminated. PSCo also holds a controlling interest in several other relatively small ditch and water companies.
SPS
SPS is an operating utility engaged primarily in the generation, purchase, transmission, distribution and sale of electricity in portions of
Texas and New Mexico. The wholesale customers served by SPS comprised approximately 38 percent of its total KWh sold in 2011.
SPS provides electric utility service to approximately 376,000 retail customers in Texas and New Mexico. Approximately 74 percent of
SPS’ retail electric operating revenues were derived from operations in Texas during 2011. Although SPS’ large commercial and
industrial electric retail customers are comprised of many diversified industries, a significant portion of SPS’ large commercial and
industrial electric sales include customers in the oil and gas extraction industry. For small commercial and industrial customers,
significant electric retail sales include customers in the following industries: oil and gas extraction and crop related agricultural
industries. Generally, SPS’ earnings contribute approximately 5 percent to 15 percent of Xcel Energy’s consolidated net income.
Other Subsidiaries
WGI is a small interstate natural gas pipeline company engaged in transporting natural gas from the PSCo system near Chalk
Bluffs, Colo., to the Cheyenne system near Cheyenne, Wyo.
WYCO was formed as a joint venture with CIG to develop and lease natural gas pipeline, storage, and compression facilities.
Xcel Energy has a 50 percent ownership interest in WYCO. The gas pipeline and storage facilities are leased under a FERC-
approved agreement to CIG.
Xcel Energy Services Inc. is the service company for Xcel Energy Inc.
Xcel Energy Inc.’s nonregulated subsidiary is Eloigne, which invests in rental housing projects that qualify for low-income
housing tax credits.
Xcel Energy conducts its utility business in the following reportable segments: regulated electric utility, regulated natural gas
utility and all other. See Note 16 to the consolidated financial statements for further discussion relating to comparative segment
revenues, income from continuing operations and related financial information.
Seasonality
The demand for electric power generation and natural gas is affected by seasonal differences in the weather. In general, peak sales
of electricity occur in the summer and winter months, and peak sales of natural gas occur in the winter months. As a result, the
overall operating results may fluctuate substantially on a seasonal basis. Additionally, Xcel Energy’s operations have historically
generated less revenues and income when weather conditions are milder in the winter and cooler in the summer. See Item 7 —
Management’s Discussion of Financial Condition and Results of Operations.