Xcel Energy Files Form 8-K: Request for Rate Increase in New Mexico

Strategic Insights -

Xcel Energy's subsidiary, Southwestern Public Service Company (SPS), has filed an electric rate case with the New Mexico Public Regulation Commission (NMPRC) seeking an increase in base rates of approximately $88 million. This increase, primarily driven by additional capital investment in new and upgraded electric facilities and equipment, will result in a net rate increase of approximately $48 million, or 10%, for New Mexico customers. The proposed rate increase will cover the cost of the 522 megawatt Sagamore wind project, which began commercial operations on time in December 2020.

Key Takeaways:

  • SPS has requested a base rate increase of approximately $88 million, with a net increase of $48 million for New Mexico customers.
  • The increase is primarily driven by additional capital investment in new and upgraded electric facilities and equipment.
  • The Sagamore wind project, which began commercial operations in December 2020, is a key component of the rate increase.
  • The proposed rate increase includes offsetting fuel cost reductions and production tax credits (PTCs) attributable to the Sagamore wind project.
  • SPS has requested new rates to be effective on February 3, 2021, but the NMPRC is expected to suspend rates for nine months pending review.

Statistics:

  • $88 million: Proposed base rate increase
  • $48 million: Net rate increase for New Mexico customers
  • 10%: Percentage increase in net rate for New Mexico customers
  • 522 megawatts: Capacity of the Sagamore wind project
  • December 2020: Commercial operations began for the Sagamore wind project
  • February 3, 2021: Proposed effective date for new rates
  • Fourth quarter 2021: Expected NMPRC decision and implementation of final rates

Sources:

  • Xcel Energy Inc., Form 8-K (Current Report), January 4, 2021
  • UNITED STATES SECURITIES AND EXCHANGE COMMISSION, Washington, D.C. 20549