Xcel Energy 2014 Annual Report Download - page 12

Xcel Energy
Annual Report 2014 10
A key component of that approach is changing our
corporate culture to think and act competitively. In
many ways, the timing is right for change because
we are experiencing a major transition in our
workforce as baby boomers retire. Our goal is a
workforce that is more engaged than ever and
ready for competition.
Meanwhile, we continue to rely on fundamentals
such as controlling costs and satisfying customers.
We want to keep the growth of our operating and
maintenance costs between 0 percent – 2 percent,
and we want to keep customer satisfaction high.
Expand customer options and solutions
Satisfying customers—another important part of
the plan—means giving them what they need and
more. This year alone we plan to invest more than
$3 billion to keep our systems safe and reliable,
which is fundamental in meeting customer needs.
Beyond that, we are expanding our portfolio of
renewable energy sources and developing new
programs to give them more choices in the kind of
energy they use and more options to save energy.
One of the best examples of our proactive approach
for customers is a resource plan we proposed for the
Upper Midwest that would double our renewable
energy portfolio and reduce carbon emissions
40 percent by 2030. With carbon reduction as its
driver, the plan gradually reduces our reliance on
our coal-red generating units but maintains a
diversity of resources to keep costs reasonable.
In the end, we would have an energy mix that
is 63 percent carbon free.
Invest for the future
In the fourth component of our strategic plan, we
are making signicant investments to upgrade and
strengthen our energy systems and exploring
other ways to grow our business and ensure
long-term success.
The $14.5 billion of system investments we
are making over the next ve years, for example,
grow our rate base, or the value of our assets, by
4.7 percent annually. Beyond that, we are focusing
in particular on growth opportunities in transmission
and natural gas, businesses where we already have
a lot of expertise.
In 2014, we created three independent transmission
companies, or Transcos, to give us the exibility
to compete in a competitive transmission market.
With respect to transmission, we also are exploring
opportunities through our operating companies in
states that offer favorable regulatory frameworks.
It’s a two-pronged approach that gives us the
exibility to choose projects that make sense
for customers and provide value.
While we are in the early days of pursuing growth
in natural gas, we see great opportunities for new
infrastructure as our industry works to address the
EPA’s proposed carbon rules. We will be building
infrastructure but also considering upstream
investments, which means looking at the potential
of investing in a natural gas transmission pipeline
or perhaps natural gas reserves. Right now, we are
expanding natural gas to communities previously
served only by propane. In 2014, we added three
Minnesota communities with more than 1,100
new customers and expected annual revenue
of $600,000.
Promising options exist, and we are approaching
them with the careful consideration we always
bring to manage risk and ensure value for you.