Item 8.01. Other Events



In February 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 Public Utility Commission of Texas (PUCT) seeking an
increase in retail electric base rates of approximately $143 million. SPS' net
rate increase to Texas customers is expected to be approximately $74 million, or
9.2%, as a result of the offsetting $69 million in fuel cost reductions and
production tax credits (PTCs) from the Sagamore wind project.
The request is based on a return on equity (ROE) of 10.35%, an equity ratio of
54.60%, a rate base of approximately $3.3 billion and a historic test year based
on the 12-month period ended Dec. 31, 2020.
The request includes the effect of losing approximately 400 MW from a wholesale
transmission customer and changes to depreciation lives of SPS' Tolk power plant
(from 2037 to 2032) and coal handling assets at the Harrington facility (to
2024).
On Aug. 13, 2021, the Alliance of Xcel Municipalities (AXM), Office of Public
Utility Counsel (OPUC) and Texas Industrial Energy Consumers (TIEC) filed
testimony along with several other parties.
Proposed modifications to SPS' request:
(Millions of Dollars)                                AXM       OPUC       TIEC (a)
SPS Update Testimony                               $ 143      $ 143      $     143

Recommended base rate adjustments:
ROE                                                  (34)       (22)           (29)
Capital structure                                    (14)         -            (11)

Jurisdictional allocators                              -         (9)            (5)
Depreciation expense                                 (20)        (7)            (2)
Other operating and maintenance expense               (5)         -             (2)
Labor and incentive related adjustments               (5)        (1)             -
Other, net (b)                                        (3)        (5)             -

Total adjustments                                  $ (81)     $ (44)     $     (49)
Total proposed revenue change                      $  62      $  99      $      94

(a)The quantification of capital structure is based on a 50% equity ratio. (b)OPUC and AXM recommend exclusion of approximately $34 million and $42 million, respectively, in steam, internal combustion and transmission equipment.



On Aug. 20, 2021, the PUCT Staff (Staff) filed testimony supporting a total
proposed revenue change of $110 million. Staff's total adjustment of
approximately $33 million was proposed separately and apart from its positions
on specific issues.

Recommended Position         Staff         AXM         OPUC                 TIEC
ROE                          9.35  %      8.88  %      9.35  %                      9.10  %
Equity ratio                51.00  %     50.00  %     54.60  %              48.60 - 51.00 %


Expected procedural next steps:
•Rebuttal testimony - Sept. 15, 2021
•Public hearing - Oct. 18 - Oct. 28, 2021
The PUCT set current rates as temporary as of March 15, 2021. Once final rates
are approved, a surcharge will be requested from March 15, 2021 through the
effective date of new base rates. A PUCT decision is expected in the first
quarter of 2022.

--------------------------------------------------------------------------------

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, 2020, 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.

--------------------------------------------------------------------------------

© Edgar Online, source Glimpses