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Xcel Energy files long-range generation resource plan;  aligns efforts to meet Colorado Climate Action Plan goal

DENVER - Xcel Energy in Colorado announced today that it would seek by 2015 to add approximately 1,050 megawatts of renewable generation, reduce current electricity demand by 694 megawatts through enhanced energy efficiency programs, and replace two older, coal-fired power plants with a more efficient, natural gas facility.

The company’s Colorado Resource Plan (CRP) filed today would help reduce greenhouse gas emissions from Xcel Energy by at least 10 percent by 2017, when compared with 2005 levels. The company further committed to file an expedited resource plan in 2009, which would provide options and make recommendations to put the company on a path to reduce the utility’s greenhouse gas emissions by up to 20 percent by 2020, a goal recently set by Colorado Gov. Bill Ritter.

“Xcel Energy fully supports ambitious efforts to reduce greenhouse gas emissions, in Colorado and throughout our service territory. But, it is important to balance these environmental objectives with the equally important goals of reasonable customer rates and a reliable electric system,” said Richard C. Kelly, Xcel Energy chairman, president and CEO. “Our proposal balances all of these components and takes an important first step on the path of achieving the goals of the governor’s Colorado Climate Action Plan.”

As it did today, Xcel Energy typically files its resource plan every four years with the Colorado Public Utilities Commission (CPUC). The current CRP identifies future generation needs and resources for the next eight years, through 2015. The planning process includes the utility, regulators, customer advocates, environmental groups and other interested parties.

Xcel Energy’s next resource plan would address further reductions after 2015, with the expectation that federal and state environmental regulations will be better defined, and future technologies to reduce greenhouse gases may be further developed.

Kelly stated that the emphasis the company is placing on the environment represents a substantial shift away from the way major U.S. utilities have operated in the past. He noted that in 2003, and in order to meet customer demand, the company estimated that it would have increased carbon dioxide emissions by 20 percent by 2020.

Through major investments in conservation, wind and other renewable energy technologies, however, the company now proposes a plan that will put Xcel Energy on a path to reduce carbon dioxide emissions, Kelly said.

“We will achieve these greenhouse gas reduction goals, while meeting a growing customer load and keeping prices reasonable,” Kelly said.

Specific resource needs and associated costs will be determined throughout the resource planning process. Among the specific components of the CRP, however, the company plans to pursue the following generation goals if approved by the CPUC:

• Wind Power: Increase the portfolio of wind power resources by 800 megawatts by 2015. Xcel Energy would then have a total of approximately 1,900 megawatts in Colorado. Xcel Energy currently is the nation’s number one wind power provider.
•  Solar Power: Incorporate efficient, utility-scale solar power, starting with the acquisition of approximately 25 megawatts of capacity from a central solar power plant, with plans to bring in a plant of up to 200 megawatts as technology develops.
•  On-Site Solar: Pursue an additional 29 megawatts of on-site, customer-owned solar installations, as part of the company’s Solar*Rewards program.
• Energy Efficiency: Increase participation in enhanced customer efficiency and conservation programs in Colorado. Xcel Energy plans to double the current capacity of its customer programs to 694 megawatts, while tripling the amount of annual energy sales reductions to approximately 2,350 gigawatt-hours, by 2020.
•  Plant Retirement/Replacement: To meet carbon dioxide reduction goals, the company would replace the output of four coal-burning units (at two power plants) with a highly efficient, natural gas generating facility; this would reduce carbon dioxide emissions by 1.4 million tons each year. The plants to be replaced total 229 megawatts of generation, and include the Arapahoe Generating Station in Denver and the Cameo Generating Station east of Grand Junction.

By the end of December 2015, Xcel Energy will be producing about 20 percent of its energy sales from renewable resources – continuing the company’s goal to remain well ahead of the state’s Renewable Energy Standard (RES).

The incremental costs of acquiring renewable energy under the CRP would be consistent with the state’s current RES, which was passed this year by the Colorado General Assembly (House Bill 07-1281). The RES limits consumer price increases for the cost of renewable resources to 2 percent more than the cost of conventional generating resources. Colorado voters approved the state’s first renewable standard and corresponding funding in November 2004.

In addition to new renewable and energy-efficiency generation goals,
 Xcel Energy will seek to competitively acquire additional natural gas-fired generation of approximately 800 megawatts.

Xcel Energy (NYSE: XEL) is a major U.S. electricity and natural gas company with regulated operations in eight Western and Midwestern states. Xcel Energy provides a comprehensive portfolio of energy-related products and services to 3.3 million electricity customers and 1.8 million natural gas customers through its regulated operating companies. Company headquarters are located in Minneapolis. More information is available at www.xcelenergy.com.
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This news release includes forward-looking statements that are subject to certain risks, uncertainties and assumptions. Such forward-looking statements are intended to be identified in this document by the words “anticipate,” “estimate,” “expect,” “projected,” “objective,” “outlook,” “possible,” “potential” and similar expressions. Actual results may vary materially. Factors that could cause actual results to differ materially include, but are not limited to: general economic conditions, including their impact on capital expenditures; business conditions in the energy industry; competitive factors; unusual weather; changes in federal or state legislation; regulation; risks associated with the California power market; currency translation and transaction adjustments; the higher degree of risk associated with
Xcel Energy’s non-regulated businesses compared with Xcel Energy’s regulated business; and the other risk factors listed from time to time by Xcel Energy in reports filed with the Securities and Exchange Commission.