1. EEI Financial Conference
November 9 - 12, 2008
Scottsdale, Arizona
Xcel Energy Inc.
414 Nicollet Mall
Minneapolis, Minnesota
55401
www.xcelenergy.com
2. Safe Harbor
This material includes forward-looking statements that are subject to
certain risks, uncertainties and assumptions. Such forward-looking
statements include projected earnings, cash flows, capital
expenditures and other statements and are identified in this document
by the words “anticipate,” “estimate,” “expect,” “projected,”
“objective,” “outlook,” “possible,” “potential” and similar
expressions. Actual results may vary materially. Factors that could
cause actual results to differ materially include, but are not limited to:
general economic conditions, including the availability of credit,
actions of rating agencies and their impact on capital expenditures;
business conditions in the energy industry; competitive factors;
unusual weather; effects of geopolitical events, including war and acts
of terrorism; changes in federal or state legislation; regulation; actions
of accounting regulatory bodies; and other risk factors listed from
time to time by Xcel Energy in reports filed with the SEC, including
Exhibit 99.01 to Xcel Energy’s report on Form 10-K for year 2007.
4. Fundamental Elements of Xcel Energy
Credit quality
Balance sheet strength
Strong liquidity
Flexibility
Safe dividend
Solid growth prospects
We are positioned to execute our strategy –
despite economic headwinds
5. Solid Credit Ratings
Secured Unsecured
Fitch Moody’s S&P Fitch Moody’s S&P*
Holding Co. – – – BBB+ Baa1 BBB
NSPM A+ A2 A A A3 BBB+
NSPW A+ A2 A A A3 A-
A-
PSCo A A3 A A– Baa1 BBB+
A–
SPS – – – BBB+ Baa1 BBB+
* S&P upgraded the unsecured ratings for NSPM, NSPW and PSCo
on November 5, 2008
6. Proactive Equity Issuance
Issued 17.25 million shares in September 2008
Proceeds of approximately $345 million
Rationale for equity issuance:
Fund capital expenditure growth plan
Keeps balance sheet strong
Prudently took advantage of a stable period
in a disruptive capital market
Consistent with our financial plans and
message to investors
7. Strong Balance Sheet
Millions Percent
Equity $ 6,848 42.5%
Preferred Equity 104 0.6%
Hybrid Security 400 2.5%
Current Portion LT Debt 994 6.2%
Short-term Debt 264 1.6%
Long-term Debt 7,486 46.5%
Total Capitalization $16,096 100%
As of September 30, 2008
8. Strong Liquidity
Dollars in millions as of October 31, 2008
Credit Total
Lines Available Cash Liquidity
HoldCo $ 772 $ 406 $ 13 $ 419
NSPM 482 476 1 477
PSCo 675 668 49 717
SPS 248 108 34 142
Other * 0 0 61 61
Total $2,177 $1,658 $ 159 $1,816
* Excludes $18.5 million held in The Reserve Fund
9. Modest Debt Maturities
Dollars in millions
$1,200
SPS
$1,000
PSCo
$800 NSPM
Xcel Energy
$600
$400
$200
$0
2009 2010 2011 2012 2013 2014
10. Strong Access to Credit Markets in 2008
Hold Co - issued $400 million of retail hybrid securities
with a 7.6% coupon in January
NSP-Minnesota - issued $500 million of first mortgage
bonds with 10-year maturity and 5.25% coupon in March
PSCo - issued $600 million of first mortgage bonds in
August:
10-year tranche with a 5.8% coupon
30-year tranche with a 6.5% coupon
NSP-Wisconsin – issued $200 million of first mortgage
bonds with 30-year maturity and 6.375% coupon in
September
Potential debt issuances - late 2008 or early 2009
SPS - up to $250 million of unsecured debt
11. Financial Execution
Delivering 2 – 4% Dividend Growth*
Annualized dividend per share
2004 – 2008 CAGR = 3.4%
$0.95
$0.92
$0.89
$0.86
$0.83
2004 2005 2006 2007 2008
* Xcel Energy increased the dividend by 3¢ on May 21, 2008
12. Financial Execution
Delivering on 5 – 7% EPS Growth
Guidance Range
$1.45–$1.50 $1.45–$1.55
2005 – 2009 CAGR = 6.9%**
$1.43
$1.30
$1.15
2005 2007 2008 2009
2006
Ongoing* Ongoing* Guidance Guidance
Ongoing*
* Ongoing EPS excludes the impacts of COLI and disc ops.
A reconciliation to GAAP earnings is included in the appendix.
** Estimated CAGR is based on middle of 2009 guidance range
13. Built to Last
Fully regulated utility
Constructive regulatory recovery
Earn a reasonable authorized return
Strong balance sheet
Access to credit market
Opportunistic equity issuance
Flexibility of our strategy
Meet renewable standards
Push out time-line for new baseload plant
15. Tactical Plans for 2009
Continue to execute strategic plan
Align capital investment with sales growth
forecast
Stay on track to meet RPS goals
Efficiently finance growth strategy
Achieve successful rate case outcomes
16. Capital Forecast Update
Dollars in millions
$2,350
$2,350
$2,300
$1,800
2009 2010 2011 2012
Other Nuclear Fuel Gas
Electric Distribution Electric Transmission Generation
Wind
17. NSP Wind Project
Project adds 351 megawatts of wind generation
at two different sites
Phased construction
2009 – 2011
Total cost approximately
$900 million
Rider recovery
18. Financing Plans
Strong access to capital markets
Modest financing needs for 2009
NSP-M $400 million of first mortgage bonds
PSCo $400 million of first mortgage bonds
19. Minnesota Electric Rate Case
2009 Forward test year
Filed November 3, 2008
Seeking rate relief of $156 million
Electric rate base of $4.1 billion
Requested ROE of 11.0%
Equity ratio of 52.5%
Interim rates of $155 million effective January 2009
Decision expected fall/winter 2009
20. Colorado Electric Rate Case
Expected filing in November 2008
Seeking 2009 forward test year
Electric rate base of $4.1 billion
Decision expected 3rd quarter 2009
Partial year revenue increase
Looking at options regarding 2010 test year
Rate increase request will be partially offset by
fuel and capacity cost savings from Comanche 3
22. Key Take-Aways
Our strategy remains unchanged and on track
We have the liquidity and balance sheet
to finance our rate base growth strategy
Guidance reflects economic realities
We are well-positioned to execute our
business plan
23. Upcoming Analyst Meeting
Wednesday, December 3rd
Date:
Location: Westin New York at Times Square
Topics: Strategic overview
Generation plan
Renewable plan
Transmission plan
Regulatory update
Financial overview
26. Company Profile
Traditional Regulation
NSP-Wisconsin
NSP-Minnesota 6% of earnings * Operate in 8 States
40% of earnings *
Combination Utility
Electric 85% of net income
Gas 15% of net income
PSCo
49% of earnings *
Customers
3.3 million electric
1.8 million gas
SPS
2007 Financial Statistics
5% of earnings *
NI Ongoing: $612 million
NI GAAP: $577 million
* Percentages based on 2007 Ongoing Earnings
Assets: $23 billion
Equity ratio: 43%
2007 EPS Ongoing: $1.43; GAAP: $1.35
2008 Dividend $0.95 per share annualized
27. Reconciliation –
Ongoing EPS to GAAP
Dollars per share
2007
2005 2006
Ongoing Earnings $1.15 $1.30 $1.43
PSRI/COLI 0.05 0.05 (0.08)
Continuing Operations $1.20 $1.35 $1.35
Disc Ops 0.03 0.01 –
GAAP Earnings $1.23 $1.36 $1.35
As a result of the termination of the COLI program, Xcel Energy’s management
Energy’s
believes that ongoing earnings provide a more meaningful comparison of earnings
comparison
results between different periods in which the COLI program was in place and is
more representative of Xcel Energy’s fundamental core earnings power.
Energy’s
Xcel Energy’s management uses ongoing earnings internally for financial planning
Energy’s planning
and analysis, for reporting of results to the Board of Directors, in determining
Directors,
whether performance targets are met for performance-based compensation,
performance-based
and when communicating its earnings outlook to analysts and investors.
investors.
28. Pending Rate Cases
Status
Requested
North Dakota Electric June 2008 Pending
$17.9 million Fall 2008
10.75% ROE Interim rates
SPS Wholesale March 2008 Pending
$14.9 million Fall 2008
12.2% ROE
Texas Electric June 2008 Pending
$61.3 million overall Qtr 1 2009
11.25% ROE
NSP-Wisconsin August 2008 Pending
Limited Reopener Qtr 4 2008
$47.1 million
29. 2008 Regulatory Outcomes
Requested Approved
New Mexico Electric December 2007 August 2008
$17.3 million $10.7 million
11.0% ROE 10.18% ROE
PSCo Wholesale February 2008 Settlement
Base rates $8.8 million $6.5 million
CWIP $3.7 million Blackbox
11.5% ROE
30. 2007 Rate Base and ROE
Weather Normalized
Dollars in millions
Rate Base Earned ROE
Minnesota Electric $4,054 11.02%
Minnesota Gas 456 7.74
North Dakota Electric 202 2.96
North Dakota Gas 44 7.66
South Dakota Electric 251 9.28
Colorado Electric 3,569 10.09
Colorado Gas 1,096 10.45
Wisconsin Electric 554 8.33
Wisconsin Gas 77 8.59
Texas Electric 940 4.61*
New Mexico Electric** 276 2.24*
Wholesale 982 Not Reported
Total Rate Base $12,501
* Texas and New Mexico ROE’s are actual earned, not weather normalized
** Results impacted by fuel disallowance
