Xcel Energy 2015 Annual Report Download - page 140
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• Evidentiary hearing — Oct. 4-7, 2016;
• ALJ report — Feb. 21, 2017; and
• MPUC order — June 1, 2017.
NSP-Minnesota – Nuclear Project Prudence Investigation — In 2013, NSP-Minnesota completed the Monticello LCM/EPU project.
The multi-year project extended the life of the facility and increased the capacity from 600 to 671 MW. The Monticello LCM/EPU
project expenditures were approximately $665 million. Total capitalized costs were approximately $748 million, which includes
AFUDC. In 2008, project expenditures were initially estimated at approximately $320 million, excluding AFUDC.
In 2013, the MPUC initiated an investigation to determine whether the final costs for the Monticello LCM/EPU project were prudent.
In March 2015, the MPUC voted to allow for full recovery, including a return, on approximately $415 million of the total plant costs
(inclusive of AFUDC), but only allow recovery of the remaining $333 million of costs with no return on this portion of the investment
over the remaining life of the plant. Further, the MPUC determined that only 50 percent of the investment was considered used-and-
useful for 2014. As a result of these determinations, Xcel Energy recorded an estimated pre-tax loss of $129 million in the first quarter
of 2015, after which the remaining book value of the Monticello project represented the present value of the estimated future cash
flows.
NSP-Minnesota – 2016 TCR Filing — In October 2015, NSP-Minnesota submitted its 2016 TCR filing with the MPUC, requesting
recovery of $19.2 million of 2016 transmission investment costs not included in electric base rates. This filing included an option to
keep approximately $59.1 million of revenue requirements associated with two CapX2020 projects completed in 2015 within the TCR
rider or to include these revenue requirements in electric base rates during the interim rate implementation of the next electric rate
case. In November 2015, NSP-Minnesota submitted an update to its TCR filing in which it confirmed that it was requesting the
MPUC approve keeping the two CapX2020 projects in the TCR rider, increasing the revenue requirements to $78.3 million, until the
conclusion of the 2016 Minnesota electric rate case.
Recently Concluded Regulatory Proceedings — SDPUC
NSP-Minnesota – South Dakota Infrastructure Rider —In December 2015, the SDPUC approved recovery of $10.2 million through
the infrastructure rider effective beginning Jan. 1, 2016. As part of the South Dakota 2015 electric rate case, the infrastructure rider
was refreshed with new projects and was also expanded as a mechanism to allow for possible recovery of other investments related to
generation, transmission, and distribution.
Electric, Purchased Gas and Resource Adjustment Clauses
CIP and CIP Rider — In December 2012, the MPUC approved reductions to the CIP financial incentive mechanisms effective for the
2013 through 2015 program years and in 2015 extended the mechanisms to the 2016 program year. The estimated average annual
electric and natural gas incentives are $30.6 million and $3.6 million, respectively, based on the approved savings goals.
CIP expenses are recovered through base rates and a rider that is adjusted annually.
• In July 2015, the MPUC approved NSP-Minnesota’s 2014 CIP electric and natural gas financial incentives totaling $40.1
million and $5.8 million, respectively.
• In addition, the MPUC approved NSP-Minnesota’s proposed 2015 to 2016 electric and natural gas CIP riders. NSP-
Minnesota estimates 2016 recovery of $21.5 million of electric CIP expenses and $9.2 million of natural gas CIP expenses.
• This proposed recovery through the riders is in addition to an estimated $86.9 million and $3.7 million through electric and
gas base rates, respectively.
NSP-Minnesota – Gas Utility Infrastructure Cost (GUIC) Rider — In October 2015, NSP-Minnesota filed the GUIC rider with the
MPUC for approval to recover the cost of natural gas infrastructure investments in Minnesota to improve safety and reliability. Costs
include funding for pipeline assessments as well as deferred costs from NSP-Minnesota’s existing sewer separation and pipeline
integrity management programs. Sewer separation costs stem from the inspection of sewer lines and the redirection of gas pipes in the
event their paths are in conflict. NSP-Minnesota requested recovery of approximately $15.5 million from Minnesota gas utility
customers beginning April 1, 2016. This request includes $1.9 million in over-recovery from 2015 and $4.5 million of deferred sewer
separation and integrity management costs which is the 2016 portion of a five year amortization.
An MPUC decision is expected in the second half of 2016.