Item 8.01. Other Events



On Jan. 4, 2021, Southwestern Public Service Company (SPS), a New Mexico
corporation, and a wholly owned subsidiary of Xcel Energy Inc., filed an
electric rate case with the New Mexico Public Regulation Commission (NMPRC)
seeking an increase in base rates of approximately $88 million. SPS' net rate
increase to New Mexico customers is expected to be approximately $48 million, or
10%, as a result of offsetting fuel cost reductions and production tax credits
(PTCs) attributable to wind energy provided by the Sagamore wind project. PTCs
are being credited to customers through the fuel clause.
The request is primarily driven by additional capital investment in new and
upgraded electric facilities and equipment since SPS' previous rate case in
2019, including New Mexico's allocated portion of the 522 megawatt Sagamore wind
project, which began commercial operations on time in December 2020.
The request is based on a historic test year ended Sept. 30, 2020, including
expected capital additions through Feb. 28, 2021, a return on equity of 10.35%,
an equity ratio of 54.72% (based on actual capital structure) and retail rate
base of approximately $1.9 billion (total company rate base of approximately
$6.0 billion).
Additionally, the request includes the effect of approximately 400 megawatts of
reduced peak load in 2021 from a wholesale transmission customer and changes to
depreciation rates to reflect a reduction to the service lives of SPS' Tolk
power plant (from 2037 to 2032) and the coal handling assets at the Harrington
facility (to 2024).
SPS' base rate request:
                 Rate Request (Millions of Dollars)
                 Sagamore wind project investment                $ 38
                 Other plant investment                            40
                 Allocator changes due to load growth               9
                 Depreciation rate change (including Tolk)          3
                 Other, net                                        (2)
                 Total rate request                                88
                 Fuel cost reductions and PTCs                    (40)
                 Net rate increase                               $ 48

SPS requested new rates to be effective on Feb. 3, 2021, however the NMPRC is expected to suspend rates for nine months beyond the 30-day notice period, consistent with historic practice, pending review. A NMPRC decision and implementation of final rates is anticipated in the fourth quarter of 2021.




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Certain information discussed in this Current Report on Form 8-K is forward-looking information that involves risks, uncertainties and assumptions. Such forward-looking statements, including our expectations regarding net rate increases to consumers and regarding the regulatory proceedings, as well as assumptions and other statements are intended to be identified in this document by the words "anticipate," "believe," "could," "estimate," "expect," "intend," "may," "objective," "outlook," "plan," "project," "possible," "potential," "should," "will," "would," and similar expressions. Actual results may vary materially. Forward-looking statements speak only as of the date they are made, and we expressly disclaim any obligation to update any forward-looking information. The following factors, in addition to those discussed in Xcel Energy's and SPS' Annual Report on Form 10-K for the year ended Dec. 31, 2019, and subsequent filings with the Securities and Exchange Commission, could cause actual results to differ materially from management expectations as suggested by such forward-looking information: uncertainty around the impacts and duration of the COVID-19 pandemic; operational safety, including our nuclear generation facilities; successful long-term operational planning; commodity risks associated with energy markets and production; rising energy prices and fuel costs; qualified employee work force and third-party contractor factors; ability to recover costs, changes in regulation and subsidiaries' ability to recover costs from customers; reductions in our credit ratings and the cost of maintaining certain contractual relationships; general economic conditions, including inflation rates, monetary fluctuations and their impact on capital expenditures and the ability of Xcel Energy Inc. and its subsidiaries to obtain financing on favorable terms; availability or cost of capital; our customers' and counterparties' ability to pay their debts to us; assumptions and costs relating to funding our employee benefit plans and health care benefits; our subsidiaries' ability to make dividend payments; tax laws; effects of geopolitical events, including war and acts of terrorism; cyber security threats and data security breaches; seasonal weather patterns; changes in environmental laws and regulations; climate change and other weather; natural disaster and resource depletion, including compliance with any accompanying legislative and regulatory changes; and costs of potential regulatory penalties.

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