Xcel Energy Inc. · NASDAQ:XEL
Xcel Energy — Merrill Lynch Global Power & Gas Leaders Conference 2005
43 slides from Xcel Energy's conference presentation, Sep 27, 2005
Slide 1: Xcel Energy - Merrill Lynch Global Power & Gas Leaders Conference
2 Xcel Energy” Merrill Lynch Global Power & Gas Leaders Conference Dick Kelly President and CEO September 28, 2005
Slide 2: Safe Harbor
Safe Harbor eeneeesyeeeer reer ea SY 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 docume
Slide 3: Strategy — Building the Core
Strategy — Building the Core Invest in utility assets AND Earn our allowed return on equity
Slide 4: Investment Focus
Investment Focus Customer service Supply Fuel mix Transmission Environment
Slide 5: Capital Expenditure Forecast
Capital Expenditure Forecast es] Dollars in millions 2005 2006 2007 2008 #2009 Total Base level capital expenditures $ 991 $ 917 $1,021 $ 929 $1,085 $4,943 Minnesota MERP 191 404 197 125 56 973 Comanche 3 59 179 287 298 125 948 Total $1,241 $1,500 $1,505 $1,352 $1,266 $6,864 Anticipated annual growt
Slide 6: Drivers to Value Creation
Drivers to Value Creation* _ sr] Potential Growth Result Rate 2004 2009 2004-2009 Average rate base $10.5 B $13B 44% *All figures except 2004 depreciation are on an estimated regulatory basis, which differs from GAAP reporting. A reconciliation from GAAP reporting is shown in the appendix.
Slide 7: Drivers to Value Creation
Drivers to Value Creation* EEE ey Potential Growth Result Rate 2004 2009 2004-2009 Average rate base $10.5 B $13 B 44% Regulatory equity ratio 50.4% 50-52% Equity rate base $5.3B $6.5-6.76B *Alll figures except 2004 depreciation are on an estimated regulatory basis, which differs from GAAP reporting
Slide 8: Drivers to Value Creation
Drivers to Value Creation* ee SS Potential Growth Result Rate 2004 2009 2004-2009 Average rate base $10.5 B $13 B 44% Regulatory equity ratio 50.4% 50-52% Equity rate base $5.3B $6.5 -6.76B Regulatory return on equity 9.6% 10-11% *Alll figures except 2004 depreciation are on an estimated regulatory
Slide 9: Drivers to Value Creation
Drivers to Value Creation* ee Sey Potential Growth Result Rate 2004 2009 2004-2009 Average rate base $10.5 B $13 B 44% Regulatory equity ratio 50.4% 50-52% Equity rate base $5.3B $6.5 -6.76B Regulatory return on equity 9.6% 10-11% Regulatory net income $506 M $650-$744M 5-8% Depreciation — Cash flow
Slide 10: Regulatory, Legislative and Environmental
Regulatory, Legislative and Environmental Support for Capital Expenditures Minnesota MERP rider Comanche 3 decision — Forward CWIP and higher equity Minnesota and Texas transmission investment legislation
Slide 11: Environmental Initiatives
Environmental Initiatives ss @ — Owned Generation (GWh) Pounds per MWh 84,000 5.0 80,000 76,000 72,000 + 4.0 68,000 64,000 60,000 3.0 2000 2001 2002 2003 2004 ———~ Nitrogen Oxide emissions HE Owned generation (6Wh)— _Suttur Dioxide emissions
Slide 12: Renewable Energy Sources
Renewable Energy Sources Qu SS Type Capacity * Hydro 1,885 MW Wind 953 MW** Biomass 95 MW Solar 40 KW Total 2,933 MW * Owned and purchased ** Nameplate rating > 12% of 2004 system capacity
Slide 13: Electric Fuel and Purchased Energy Cost Recovery Mechanisms
Electric Fuel and Purchased Energy Cost Recovery Mechanisms ESS a Minnesota: Monthly recovery of prospective costs Colorado: Recovery of costs with sharing of deviations up to + $11.25 million from benchmark Texas: File for semi-annual adjustments — required if + 4% annually Wisconsin: Biennial rate
Slide 14: Retail Electric Rate Comparison
Retail Electric Rate* Comparison Ess —te 48 Cents per KWh * EEI typical bills - Summer 2004 16 14 12 10 6.01 6.06 4.87
Slide 15: Rate Cases with Potential Revenue Increases Effective in 2006
Rate Cases with Potential Revenue Increases Effective in 2006 Colorado Gas — Requested $34 million Wisconsin Electric and Gas — Requested $48 million Minnesota Electric North Dakota Electric
Slide 16: Rate Cases with Potential Revenue Increases Effective in 2007
Rate Cases with Potential Revenue Increases Effective in 2007 Ss —te Colorado Electric South Dakota Electric Texas Electric New Mexico Electric
Slide 17: Funding the Strategy
Funding the Strategy Growing cash from operations Tax loss carry-forward Proceeds from asset sales Financing: — Dividend reinvestment program — Modest debt issuance — No equity issuance necessary through 2006 Uncertain whether there is a need for public equity issuance in 2007 or 2008
Slide 18: 2005 EPS Guidance
2005 EPS Guidance Continuing Operations* sss —=™t = 2005 Guidance Regulated utility $1.27 —1.37 Holding Company & other (0.09) Total earnings from continuing operations $1.18 - 1.28 * 2005 Guidance includes COLI tax benefits of 9 cents per share
Slide 19: Dividend
Dividend —te SS Annual dividend increased by 3 cents May 2005 Current annual dividend rate of 86 cents Annual dividend increases consistent with long-term earnings growth of 2-4%
Slide 20: Xcel Energy summary
(2) Xcel Energy” =~ as Investing to meet the growing energy needs of our region Regulatory, legislative and environmental support for investment strategy Deliver low-risk, competitive total return
Slide 21: Xcel Energy
2 Xcel Energy”
Slide 22: Appendix
Appendix
Slide 23: Strong Regional Economy
2 Xcel Energy” Northern States Power Comp Wiscons Strong Regional Economy Unemployment rate — June 2005 us 5.2% Xeel service area 4.2% Job growth — 2005 Forecast ‘Xcelservice area 2.4% Xcel annual sales growth — 4 largest US electric and gas utility — Customers: 3.3 Million Electric 2.0% 1.8 Million
Slide 24: Organizational Structure
Organizational Structure 2004 Results Income from Contint Operations (Dollars Xcel Energy Inc. $527 Holding Company $(43) [ a Northern Northern i Subsidiaries states States anes Sout. | |» Eloigne Chey . coeey . Company of Service = Quixx Minnesota Wisconsin Colotads Company, $230 $54 $218 $55 $13 R
Slide 25: Rate Base and Returns
Rate Base and Returns tS aI Dollars'in milters Rate Base Earned Auth- Equity 2004 ROE orized Ratio Average 2004 ROE 2004 Minnesota - Electric retail $2,992 10.73% () 11.47% 50.3% Minnesota - Gas retail 402 8.50 10.402 50.3 North Dakota - Electric retail 166 10.80 12.00 50.3 North Dakota - Gas retail
Slide 26: Reconciliation of Estimated Regulatory Reporting from GAAP
Reconciliation of Estimated Regulatory Reporting from GAAP Common Equity Dollars in millions NSP(M) NSP(W) PSCo SPS _ Total 2004 GAAP common stockholder's equity (1) $2,007 $433 $2,287 $781 $5,507 2003 GAAP common stockholder’s equity (1) 1,809 425 2,140 814 5,188 ‘Average GAAP common stockholder's
Slide 27: Reconciliation of Estimated Regulatory Reporting from GAAP (Continued)
Reconciliation of Estimated Regulatory Reporting from GAAP (Continued) Dollars in millions Net Income NSP(M) NSP(W) PSCo SPS _ Total 2004 GAAP net income (1) $230 $54 $218 $55 $557 Adjustments -25 -26 “54 Adjusted net income for purposes of regulatory net income $205 $54 $192 $55 $506 Calculation of
Slide 28: NSP — Minnesota Rate Cases
NSP — Minnesota Rate Cases North Dakota Gas Minnesota Gas Minnesota Electric ss ——te —SSSSSS Approved June $0.7 million increase Approved July $5.8 million 10.4% ROE increase To be filed Winter 2005 2006 test year North Dakota Electric South Dakota Electric Interim rates early 2006 Decision Summer 2
Slide 29: PSCo Rate Cases
PSCo Rate Cases Colorado Gas Colorado Electric Filed May 27 Requested $34 million 11% ROE 55.49% common equity Year-end rate base Decision early 2006 To be filed Spring 2006 Decision early 2007
Slide 30: Wisconsin Electric and Gas Rate Case
Wisconsin Electric and Gas Rate Case tS et Requested ROE 11.9% Common equity ratio 56.32% Electric requested: Revenue increase of $40.8 million Gas requested: Revenue increase of $7.0 million Rates expected to be in effect January 2006
Slide 31: SPS Rate Cases
SPS Rate Cases Texas Electric New Mexico Electric To be filed Summer 2006 Decision 2007 To be filed 2006 Decision 2007
Slide 32: Capital Expenditures $6.9 Billion
Capital Expenditures $6.9 Billion 2005 — 2009 Mandated, Safety Customer Additions & Other 27% 15% Replace, Refurbish, Upgrade 15% Comanche 3 14% Nuclear Fuel 9 oh Generation MERP 10%
Slide 33: Capital Expenditure Forecast by Operating Company
Capital Expenditure Forecast by Operating Company Dollars in millions NSP-Minnesota NSP-Wisconsin PSCo SPS Total 2005 2006 2007 2008 2009 $ 645 $ 832 $ 713 $ 571 $ 605 60 79 75 74 68 425 499 593 591 488 111 90 124 116 105 $1,241 $1,500 $1,505 $1,352 $1,266
Slide 34: NSP — Minnesota Operating Company
NSP — Minnesota Operating Company Capital Expenditure Forecast Dollars in millions 2005 2006 2007 2008 2009 Total MERP $191 $404 $197 $125 $56 $ 973 Excluding MERP 454 428 516 446 549 2,393 Total $645 $832 $713 $571 $605 $3,366 MERP $ 973 Transmission 459 Nuclear fuel 336 Balance of electric 1,250 G
Slide 35: PSCo Operating Company
PSCo Operating Company Capi ‘al Expenditure Forecast Dollars in millions 2005 2006 2007 2008 2009 Total Comanche 3 $59 $179 $287 $298 $125 $ 948 Excl.Comanche3 _ 366 320 306 293 363 1,648 Total $425 $499 $593 $591 $488 $2,596 Comanche 3 $ 948 Transmission 280 Balance of electric 809 Gas 438 Common 9
Slide 36: SPS Operating Company
SPS Operating Company Capital Expenditure Forecast Dollars in millions 2005 2006 = 2007 2008 2009 Total Total $111 $90 $124 $116 $105 $546 Transmission $140 Balance of electric 406 Total electric
Slide 37: NSP — Wisconsin Operating Company
NSP — Wisconsin Operating Company Capital Expenditure Forecast - Dollars in millions 2005 2006 2007 2008 2009 ‘Total Total $60 $79 $75 $74 $68 $356 Transmission $ 73 Balance of electric 200 Gas 45 Common 38 Total $356
Slide 38: Minnesota MERP — Potential Earnings
Minnesota MERP — Potential Earnings Dollars in millions 2005 2006 2007 +2008 2009 Capital expenditures Current year $191 $404 $197 $125 $56 Cumulative $238 $642 $839 $964 $1,020 Equity ratio 48.5% 48.5% 48.5% 48.5% 48.5% Return on equity 10.86% 10.86% 10.86% 10.86% 10.86% Equity return $8 $24 $40 $4
Slide 39: Comanche — Potential Earnings
Comanche 3 — Potential Earnings Dollars in millions 2005 2006 2007 +2008 2009 Capital expenditures Current year $59 $179 $287 $298 $125 Cumulative $62 $241 $528 $826 $951 Equity ratio 56% 56% 56% 56% 56% Return on equity 10.75% 10.75% 10.75% 10.75% 10.75% Equity return $2 $9 $23 $41 $54
Slide 40: Energy Supply Mix — 2004
Energy Supply Mix — 2004 Owned and Purchased —te Fuel Mix Purchased Nuclear 12% Renewable 7% Coal * Owned 54% Generation 68% * Low-sulfur, low-mercury western coal
Slide 41: Coal Supply Contracted
Coal Supply Contracted Coal Coal Transportation 2005 99% 100% 2006 78 75 2007 65 45 2008 46 45 Annual consumption: 32 Million tons of low-sulfur, low-mercury western coal
Slide 42: Senior Debt Ratings
Senior Debt Ratings tS ey Moody’s S&P Secured Unsecured Secured Unsecured Holding Co. - Baa1 - BBB- NSPM A2 A3 A- BBB- NSPW A2 A3 A- BBB PSCo A3 Baa1 A- BBB- SPS - Baal - BBB Outlook Stable Stable
Slide 43: Searchable text section of graphics
Searchable text section of graphics shown above [L OGO] [GRAPHIC] Merrill Lynch Global Power & Gas Leaders Conference [GRAPHIC] [GRAPHIC] Dick Kelly President and CEO September 28, 2005 Sa fe Harbor This material includes forward-looking statements that are subject to certain risks, uncertainties an
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