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56
2011 Comparison with 2010 — Electric revenues increased primarily due to the cost recovery of the acquisition of the Rocky
Mountain and Blue Spruce natural gas facilities at PSCo and retail rate increases in Minnesota, Wisconsin, Texas, North Dakota
and Michigan.
Electric Margin
(Millions of Dollars)
2011 vs. 2010
Revenue requirements for PSCo gas generation acquisition (a) .................................... $
124
Retail rate increases (net of revenue subject to refund) (b) .........................................
102
Conservation and DSM revenue (offset by expenses) ............................................
31
Transmission revenue, net of costs .............................................................
20
Estimated impact of weather...................................................................
18
Conservation and DSM incentive ..............................................................
14
Non-fuel riders ...............................................................................
(5
)
Other, net (including firm wholesale and deferred fuel adjustments)...............................
30
Total increase in electric margin .............................................................
$
334
(a) The increase in revenue requirements for PSCo generation reflects the acquisition of the Rocky Mountain and Blue Spruce natural gas facilities in late 2010.
These revenue requirements are partially offset by higher O&M expense, depreciation expense, property taxes and financing costs.
(b) The retail rate increases include final rates in Wisconsin, Texas, Minnesota and North Dakota.
2011 Comparison to 2010 — The increase in electric margin was primarily due to the cost recovery of the acquisition of the
Rocky Mountain and Blue Spruce natural gas facilities at PSCo and retail rate increases in Minnesota, Wisconsin, Texas, North
Dakota and Michigan.
Natural Gas Revenues and Margin
The cost of natural gas tends to vary with changing sales requirements and the cost of natural gas purchases. However, due to the
design of purchased natural gas cost recovery mechanisms to recover current expenses for sales to retail customers, fluctuations in
the cost of natural gas have little effect on natural gas margin. The following table details natural gas revenues and margin:
(Millions of Dollars)
2012
2011
2010
Natural gas revenues................................
..............
$
1,537
$
1,812
$
1,783
Cost of natural gas sold and transported
............................
(881
)
(1,164
)
(1,163
)
Natural gas margin ................................
.............
$
656
$
648
$
620
The following tables summarize the components of the changes in natural gas revenues and natural gas margin for the years
ended Dec. 31:
Natural Gas Revenues
(Millions of Dollars) 2012 vs. 2011
Purchased natural gas adjustment clause recovery ................................
..............
$ (282)
Estimated impact of weather................................................................
..
(26)
Conservation and DSM revenue (offset by expenses) ................................
...........
(17)
PSIA rider (Colorado), offset by expenses ................................
.....................
29
Retail rate increase (Colorado, Wisconsin)................................
.....................
16
Other, net ................................................................
...................
5
Total decrease in natural gas revenues ................................
.......................
$ (275)
2012 Comparison to 2011 — Natural gas revenues decreased primarily due to the purchased natural gas adjustment clause
recovery, which is offset in operating expense.