Xcel Energy Seeking More Renewable Energy in Southwestern Public Service Co. Service Area

Business Wire, Feb 1, 2008

ROSWELL, N.M. -- Xcel Energy's Southwestern Public Service Company (SPS) is seeking proposals for new renewable energy sources as part of its plan to diversify its renewable energy portfolio.

This solicitation will enable the company to comply with recently enacted regulatory requirements to add renewable generation resources and bring significant economic development and environmental benefits to New Mexico.

Texas customers of Xcel Energy will benefit from additional energy resources as well because the SPS system is interconnected across state lines, and power is shared between the two states.

SPS will require approximately 434,931 megawatt-hours of energy produced by renewable resources, or 10 percent of its New Mexico retail sales, beginning in 2011. This requirement increases to 15 percent of New Mexico retail sales beginning January 1, 2015, followed by another increase beginning January 1, 2020 to 20 percent of New Mexico retail sales.

As part of this solicitation, the company is seeking renewable generation from solar and other renewable technologies (biomass and or geothermal).

Contracts entered into will be subject to the Reasonable Cost Threshold, which ensures that renewable energy technologies will not unduly raise customers' rates. Contracts may also be subject to explicit regulatory approval by the New Mexico Public Regulatory Commission.

Proposals are due back to the company by Monday, May 5. Energy and Renewable Energy Credits (RECs) associated with new projects and offered in response to this solicitation are required to have achieved commercial operations by January, 2011. However, as circumstances warrant, SPS may entertain offers with planned commercial operation dates after January 1, 2011.

RECs are environmental commodities that can be sold or traded. An REC represents proof that 1 megawatt-hour (MWh) of electricity was generated from an eligible renewable energy resource.

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.