Xcel Energy 2015 Annual Report Download - page 110
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Year Ended Dec. 31
(Amounts in Millions, Except Interest Rates) 2015 2014 2013
Borrowing limit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 2,750 $ 2,750 $ 2,450
Amount outstanding at period end . . . . . . . . . . . . . . . . . . . . . . . . . . 846 1,020 759
Average amount outstanding . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 601 841 481
Maximum amount outstanding. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,360 1,200 1,160
Weighted average interest rate, computed on a daily basis . . . . . . . 0.48% 0.33% 0.31%
Weighted average interest rate at end of period . . . . . . . . . . . . . . . . 0.82 0.56 0.25
Letters of Credit — Xcel Energy Inc. and its subsidiaries use letters of credit, generally with terms of one year, to provide financial
guarantees for certain operating obligations. At Dec. 31, 2015 and 2014, there were $29 million and $61 million of letters of credit
outstanding, respectively, under the credit facilities. The contract amounts of these letters of credit approximate their fair value and
are subject to fees.
Credit Facilities — In order to use their commercial paper programs to fulfill short-term funding needs, Xcel Energy Inc. and its
utility subsidiaries must have revolving credit facilities in place at least equal to the amount of their respective commercial paper
borrowing limits and cannot issue commercial paper in an aggregate amount exceeding available capacity under these credit facilities.
The lines of credit provide short-term financing in the form of notes payable to banks, letters of credit and back-up support for
commercial paper borrowings.
Credit Agreements — NSP-Minnesota, NSP-Wisconsin, PSCo, SPS and Xcel Energy Inc. each have five-year credit agreements with
a syndicate of banks. The total size of the credit facilities is $2.75 billion and each credit facility matures in October 2019.
NSP-Minnesota, PSCo, SPS, and Xcel Energy Inc. each have the right to request an extension of the termination date for two
additional one-year periods. NSP-Wisconsin has the right to request an extension of the termination date for an additional one-year
period. All extension requests are subject to majority bank group approval.
Features of the credit facilities include:
• Xcel Energy Inc. may increase its credit facility by up to $200 million, NSP-Minnesota and PSCo may each increase their
credit facilities by $100 million and SPS may increase its credit facility by $50 million. The NSP-Wisconsin credit facility
cannot be increased.
• Each credit facility has a financial covenant requiring that the debt-to-total capitalization ratio of each entity be less than or
equal to 65 percent. Each entity was in compliance at Dec. 31, 2015 and 2014, respectively, as evidenced by the table below:
Debt-to-Total Capitalization Ratio
2015 2014
Xcel Energy Inc. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57% 56%
NSP-Wisconsin . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46 48
NSP-Minnesota . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48 48
SPS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46 47
PSCo . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45 47
• If Xcel Energy Inc. or any of its utility subsidiaries do not comply with the covenant, an event of default may be declared,
and if not remedied, any outstanding amounts due under the facility can be declared due by the lender.
• The Xcel Energy Inc. credit facility has a cross-default provision that provides Xcel Energy Inc. will be in default on its
borrowings under the facility if it or any of its subsidiaries, except NSP-Wisconsin as long as its total assets do not comprise
more than 15 percent of Xcel Energy’s consolidated total assets, default on certain indebtedness in an aggregate principal
amount exceeding $75 million.
• Xcel Energy Inc. and its subsidiaries were in compliance with all financial covenants in their debt agreements as of Dec. 31,
2015 and 2014.
• The interest rates under these lines of credit are based on Eurodollar borrowing margins ranging from 87.5 to 175 basis points
per year based on the applicable long-term credit ratings.
• The commitment fees, also based on applicable long-term credit ratings, are calculated on the unused portion of the lines of
credit at a range of 7.5 to 27.5 basis points per year.