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This excerpt taken from the XEL 10-K filed Feb 27, 2006. Performance-Based Regulation — In December 2003, the MPUC voted to
approve NSP-Minnesota’s MERP proposal to convert two coal-fueled electric generating
plants to natural gas, and to install advanced pollution control equipment at a
third coal-fired plant. All three plants
are located in the Minneapolis - St. Paul metropolitan area. These improvements
are expected to significantly reduce air emissions from these facilities, while
increasing the capacity at system peak by 300 MW. The projects are expected to
come on line between 2007 and 2009, at a cumulative investment of approximately
$1 billion. The MPUC approved a rate
rider to recover prudent costs of the projects from Minnesota customers
beginning Jan. 1, 2006, including a rate of return on the construction
work in progress. The MPUC approval has
a sliding ROE scale based on actual construction cost compared with a target
level of construction costs (based on an equity ratio of 48.5 percent and debt
of 51.5 percent) to incentivize NSP-Minnesota to control construction costs.
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This excerpt taken from the XEL 10-K filed Mar 4, 2005. Performance-Based Regulation — In December 2003, the MPUC voted to approve
NSP-Minnesota’s MERP proposal to convert two coal-fueled electric generating
plants to natural gas, and to install advanced pollution control equipment at a
third coal-fired plant. All three plants
are located in the Minneapolis - St. Paul metropolitan area. These improvements
are expected to significantly reduce air emissions from these facilities, while
increasing the capacity at system peak by 300 MW. The projects are expected to
come on line between 2007 and 2009, at a cumulative investment of approximately
$1 billion. The MPUC also approved
NSP-Minnesota’s proposal to recover prudent costs of the projects through a
rate adjustment provision applicable to retail electric rates beginning Jan. 1,
2006, including a rate of return on the construction work in progress. The MPUC approval has a sliding ROE scale
based on actual construction cost compared with a target level of construction
costs (based on an equity ratio of 48.5 percent and debt of 51.5 percent) to
incentivize NSP-Minnesota to control construction costs.
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