Xcel Energy 2012 Annual Report Download - page 149

139
In 2012, revisions were made for nuclear decommissioning, asbestos, ash-containment facilities, wind facilities and electric
transmission and distribution AROs due to revised estimated cash flows.
Beginning Revisions
Ending
Balance Liabilities Liabilities to Prior
Balance
(Thousands of Dollars) Jan. 1, 2011 Recognized Settled Accretion Estimates
Dec. 31, 2011
Electric plant
Steam and other production asbestos ...... $ 93,629 $ - $ (514) $ 5,958 $ (44,731) $ 54,342
Steam and other production ash containment 19,688 - - 919 20,551 41,158
Steam production radiation sources ....... 166 - - 12 (39) 139
Nuclear production decommissioning ..... 809,474 - - 57,641 615,626
(a)
1,482,741
Wind production ........................ 38,553 - - 1,962 - 40,515
Electric transmission and distribution...... 5,727 - - 290 24,687 30,704
Natural gas plant
Gas transmission and distribution ......... 996 - - 63 - 1,059
Common and other property
Common general plant asbestos........... 1,077 - - 58 - 1,135
Total liability ......................... $ 969,310 $ - $ (514) $ 66,903 $ 616,094 $ 1,651,793
(a) The increase is primarily due to the completion of NSP-Minnesota’s triennial nuclear decommissioning study, which reflects an increase in the estimated
cost of retirement, increase in the escalation rates for each nuclear unit and a decrease in the discount rate used to calculate the net present value of the future
cash flows.
The aggregate fair value of NSP-Minnesota’s legally restricted assets, for purposes of funding future nuclear decommissioning,
was $1.3 billion as of Dec. 31, 2011, including external and internal investment funds.
In 2011, revisions were made for nuclear decommissioning, asbestos, ash-containment facilities, radiation sources and electric
transmission and distribution AROs due to revised estimated cash flows.
Indeterminate AROs — PSCo has underground natural gas storage facilities that have special closure requirements for which the
final removal date cannot be determined; therefore, an ARO has not been recorded.
Removal Costs — Xcel Energy records a regulatory liability for the plant removal costs of steam and other generation,
transmission and distribution facilities of its utility subsidiaries. Generally, the accrual of future non-ARO removal obligations is
not required. However, long-standing ratemaking practices approved by applicable state and federal regulatory commissions have
allowed provisions for such costs in historical depreciation rates. These removal costs have accumulated over a number of years
based on varying rates as authorized by the appropriate regulatory entities. Given the long time periods over which the amounts
were accrued and the changing of rates over time, the utility subsidiaries have estimated the amount of removal costs accumulated
through historic depreciation expense based on current factors used in the existing depreciation rates.
The accumulated balances by entity were as follows at Dec. 31:
(Millions of Dollars)
2012 2011
NSP-Minnesota ................................
.....................
$ 377 $
382
NSP-Wisconsin ................................
.....................
114
109
PSCo ................................
...............................
365
380
SPS ................................
................................
67
74
Total Xcel Energy ................................
.................
$ 923 $
945
Nuclear Insurance
NSP-Minnesota’s public liability for claims resulting from any nuclear incident is limited to $12.6 billion under the Price-
Anderson amendment to the Atomic Energy Act. NSP-Minnesota has secured $375 million of coverage for its public liability
exposure with a pool of insurance companies. The remaining $12.2 billion of exposure is funded by the Secondary Financial
Protection Program, available from assessments by the federal government in case of a nuclear accident. NSP-Minnesota is
subject to assessments of up to $117.5 million per reactor per accident for each of its three licensed reactors, to be applied for
public liability arising from a nuclear incident at any licensed nuclear facility in the United States. The maximum funding
requirement is $17.5 million per reactor during any one year. These maximum assessment amounts are both subject to inflation
adjustment by the NRC and state premium taxes. The NRC’s last adjustment was effective April 2010.