Xcel Energy 2012 Annual Report Download - page 134

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Electric, Purchased Gas and Resource Adjustment Incentive 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. Based on the approved savings goals, the estimated average annual electric and natural gas
incentives are $30.6 million and $3.6 million, respectively.
CIP expenses are recovered through base rates and a rider that is adjusted annually. In December 2012, the MPUC approved
NSP-Minnesota’s 2011 CIP financial incentives of $51.4 million for electric and $2.8 million for natural gas, and NSP-
Minnesota’s 2013 electric and natural gas rider requests. NSP-Minnesota estimates 2013 recovery of $54.7 million of electric CIP
expenses and $12.6 million of natural gas CIP expenses. This proposed recovery through the riders is in addition to an estimated
$77.9 million and $3.7 million through electric and gas base rates, respectively.
NSP-Wisconsin
Recently Concluded Regulatory Proceedings — PSCW
Base Rate
NSP-Wisconsin – 2012 Electric and Gas Rate Case — In June 2012, NSP-Wisconsin filed a request with the PSCW to increase
rates for electric and natural gas service, effective Jan. 1, 2013. NSP-Wisconsin requested an overall increase in annual electric
rates of $39.1 million, or 6.7 percent, and an increase in natural gas rates of $5.3 million, or 4.9 percent.
The electric rate filing was based on a 2013 forecast test year, a ROE of 10.40 percent, an equity ratio of 52.50 percent and an
average 2013 electric rate base of approximately $788.6 million. The natural gas rate request was solely due to a proposal to
recover the initial costs associated with the environmental cleanup of the Ashland/Northern States Power Lakefront Superfund
Site (the Ashland site) in Ashland, Wis.
In December 2012, the PSCW approved an electric rate increase of approximately $35.5 million, or 6.1 percent, based on a 10.4
percent ROE and an equity ratio of 52.50 percent. The PSCW also approved a natural gas rate increase of $2.7 million, or 2.5
percent, to begin recovering costs associated with the cleanup of the Ashland site. Final rates were implemented on Jan. 1, 2013.
PSCo
Pending and Recently Concluded Regulatory Proceedings — CPUC
Base Rate
PSCo 2012 Gas and Steam Rate Case — In December 2012, PSCo filed a multi-year request with the CPUC to increase
Colorado retail natural gas rates by $48.5 million in 2013 with subsequent step increases of $9.9 million in 2014 and $12.1
million in 2015. PSCo also requested to increase Colorado retail steam rates by $1.6 million in 2013 with subsequent step
increases of $0.9 million in 2014 and $2.3 million in 2015. Both requests are based on a 2013 forecast test year, a 10.5 percent
ROE, a rate base of $1.3 billion for natural gas and $21 million for steam and an equity ratio of 56 percent. Final rates are
expected to be effective in the third quarter of 2013.
PSCo is requesting an extension of its PSIA rider mechanism to collect the costs of accelerated pipeline integrity efforts,
including system renewal projects. PSCo estimates that the PSIA will increase by $26.8 million in 2014 with a subsequent step
increase of $24.7 million in 2015 in addition to the proposed changes in base rate revenue. In conjunction with the multi-year base
rate step increases, PSCo is proposing a stay-out provision and an earnings test through the end of 2015.
PSCo 2011 Electric Rate Case — In November 2011, PSCo filed a request with the CPUC to increase Colorado retail electric
rates by $141.9 million. The request was based on a 2012 forecast test year, a 10.75 percent ROE, an electric rate base of $5.4
billion and an equity ratio of 56 percent.