Xcel Energy 2013 Annual Report Download - page 138

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120
The following table presents the changes in Level 3 commodity derivatives for the years ended Dec. 31, 2013, 2012 and 2011:
Year Ended Dec. 31
(Thousands of Dollars) 2013 2012 2011
Balance at Jan. 1 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 16,649 $ 12,417 $ 2,392
Purchases. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61,474 37,595 33,609
Settlements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (45,199)(44,950)(36,555)
Net transactions recorded during the period:
Gains recognized in earnings (a) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3,947 463 69
Gains recognized as regulatory assets and liabilities . . . . . . . . . . . . . . 4,789 11,124 12,902
Balance at Dec. 31. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 41,660 $ 16,649 $ 12,417
(a) These amounts relate to commodity derivatives held at the end of the period.
Xcel Energy recognizes transfers between levels as of the beginning of each period. There were no transfers of amounts between
levels for derivative instruments for the years ended Dec. 31, 2013, 2012 and 2011.
Fair Value of Long-Term Debt
As of Dec. 31, 2013 and 2012, other financial instruments for which the carrying amount did not equal fair value were as follows:
2013 2012
(Thousands of Dollars) Carrying
Amount Fair Value Carrying
Amount Fair Value
Long-term debt, including current portion . . . . . . . . . . . $ 11,191,517 $ 11,878,643 $ 10,402,060 $ 12,207,866
The fair value of Xcel Energy’s long-term debt is estimated based on recent trades and observable spreads from benchmark interest
rates for similar securities. The fair value estimates are based on information available to management as of Dec. 31, 2013 and 2012,
and given the observability of the inputs to these estimates, the fair values presented for long-term debt have been assigned a Level 2.
12. Rate Matters
NSP-Minnesota
Pending and Recently Concluded Regulatory Proceedings — MPUC
NSP-Minnesota – Minnesota 2014 Multi-Year Electric Rate Case — On Nov. 4, 2013, NSP-Minnesota filed a two-year, electric rate
case with the MPUC. The rate case is based on a requested ROE of 10.25 percent, a 52.5 percent equity ratio, a 2014 average electric
rate base of $6.67 billion and an additional average rate base of $412 million in 2015.
The NSP-Minnesota electric rate case reflects an overall increase in revenues of approximately $193 million or 6.9 percent in 2014
and an additional $98 million or 3.5 percent in 2015. The request includes a proposed rate moderation plan for 2014 and 2015. After
reflecting interim rate adjustments, the impact of NSP-Minnesota’s request on customer bills would result in a 4.6 percent increase in
2014 and an additional 5.6 percent in 2015.
NSP-Minnesota’s moderation plan includes the acceleration of the eight-year amortization of the excess theoretical depreciation
reserve which the MPUC approved in NSP-Minnesota’s last electric rate case and the use of expected funds from the DOE for
settlement of certain claims. These DOE refunds would be in excess of amounts needed to fund its decommissioning expense. The
interim rate adjustments are primarily associated with ROE, Monticello LCM/EPU project costs and NSP-Minnesota’s request to
amortize amounts associated with the canceled Prairie Island EPU project. NSP-Minnesota plans to file a petition for deferred
accounting regarding these Monticello costs in the first quarter of 2014.