Xcel Energy 2021 Year End Earnings Report
- 2021 earnings per share were $2.96 compared with $2.79 per share in 2020.
- Xcel Energy reaffirms 2022 EPS earnings guidance of $3.10 to $3.20 per share.
MINNEAPOLIS–(BUSINESS WIRE)–Xcel Energy Inc. (NASDAQ: XEL) today reported 2021 GAAP and ongoing earnings of $1.60 billion, or $2.96 per share, compared with $1.47 billion, or $2.79 per share in the same period in 2020.
Earnings reflect higher electric and natural gas revenues, which were partially offset by increases in electric fuel and purchased power, costs of natural gas sold and transported, additional depreciation and lower allowance for funds used during construction (AFUDC).
“We had a solid year delivering earnings of $2.96 per share and achieving our earnings guidance for the 17th consecutive year. We are well positioned for the future and are reaffirming our 2022 ongoing EPS guidance of $3.10 – $3.20,” said Bob Frenzel, chairman, president and CEO.
“We also reached constructive regulatory settlements in Colorado with our clean energy plan, the Colorado Power Pathway transmission investment plan and our electric rate case. Additionally, we reached a settlement in principle in our Texas rate case.”
“Finally, I must extend my appreciation to the entire Xcel Energy team and our industry partners for their dedication and tireless work to help our Colorado customers impacted by the devastating wildfires and historic windstorm in December. It is inspiring to see how the entire community came together to support one another, and I am thankful for our employees and all those who have played a role in helping those who have lost so much.”
At 9:00 a.m. CDT today, Xcel Energy will host a conference call to review financial results. To participate in the call, please dial in 5 to 10 minutes prior to the start and follow the operator’s instructions.
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US Dial-In: |
(800) 289-0720 |
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International Dial-In: |
(400) 120-9264 |
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Conference ID: |
4764710 |
The conference call also will be simultaneously broadcast and archived on Xcel Energy’s website at www.xcelenergy.com. To access the presentation, click on Investors under Company. If you are unable to participate in the live event, the call will be available for replay from 12:00 p.m. CDT on Jan. 27 through 12:00 p.m. CDT on Jan. 30.
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Replay Numbers |
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US Dial-In: |
(888) 203-1112 |
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International Dial-In: |
(719) 457-0820 |
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Access Code: |
4764710 |
Except for the historical statements contained in this report, the matters discussed herein are forward-looking statements that are subject to certain risks, uncertainties and assumptions. Such forward-looking statements, including the 2022 EPS guidance, long-term EPS and dividend growth rate objectives, future sales, future expenses, future tax rates, future operating performance, estimated base capital expenditures and financing plans, projected capital additions and forecasted annual revenue requirements with respect to rider filings, expected rate increases to customers, expectations and intentions regarding regulatory proceedings, and expected impact on our results of operations, financial condition and cash flows of resettlement calculations and credit losses relating to certain energy transactions, as well as assumptions and other statements are intended to be identified in this document by the words “anticipate,” “believe,” “could,” “estimate,” “expect,” “intend,” “may,” “objective,” “outlook,” “plan,” “project,” “possible,” “potential,” “should,” “will,” “would” and similar expressions. Actual results may vary materially. Forward-looking statements speak only as of the date they are made, and we expressly disclaim any obligation to update any forward-looking information. The following factors, in addition to those discussed in Xcel Energy’s Annual Report on Form 10-K for the fiscal year ended Dec. 31, 2020 and subsequent filings with the Securities and Exchange Commission, could cause actual results to differ materially from management expectations as suggested by such forward-looking information: uncertainty around the impacts and duration of the COVID-19 pandemic; operational safety, including our nuclear generation facilities; successful long-term operational planning; commodity risks associated with energy markets and production; rising energy prices and fuel costs; qualified employee work force and third-party contractor factors; ability to recover costs, changes in regulation and subsidiaries’ ability to recover costs from customers; reductions in our credit ratings and the cost of maintaining certain contractual relationships; general economic conditions, including inflation rates, monetary fluctuations, supply chain constraints and their impact on capital expenditures and/or the ability of Xcel Energy Inc. and its subsidiaries to obtain financing on favorable terms; availability or cost of capital; our customers’ and counterparties’ ability to pay their debts to us; assumptions and costs relating to funding our employee benefit plans and health care benefits; our subsidiaries’ ability to make dividend payments; tax laws; effects of geopolitical events, including war and acts of terrorism; cyber security threats and data security breaches; seasonal weather patterns; changes in environmental laws and regulations; climate change and other weather; natural disaster and resource depletion, including compliance with any accompanying legislative and regulatory changes; and costs of potential regulatory penalties.
This information is not given in connection with any sale, offer for sale or offer to buy any security.
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XCEL ENERGY INC. AND SUBSIDIARIES |
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CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED) |
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(amounts in millions, except per share data) |
||||||||||||||||
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|
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Three Months Ended Dec. 31 |
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Twelve Months Ended Dec. 31 |
||||||||||||
|
|
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2021 |
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2020 |
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2021 |
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2020 |
||||||||
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Operating revenues |
|
|
|
|
|
|
|
|
||||||||
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Electric |
|
$ |
2,562 |
|
|
$ |
2,372 |
|
|
$ |
11,205 |
|
|
$ |
9,802 |
|
|
Natural gas |
|
|
768 |
|
|
|
554 |
|
|
|
2,132 |
|
|
|
1,636 |
|
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Other |
|
|
25 |
|
|
|
21 |
|
|
|
94 |
|
|
|
88 |
|
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Total operating revenues |
|
|
3,355 |
|
|
|
2,947 |
|
|
|
13,431 |
|
|
|
11,526 |
|
|
|
|
|
|
|
|
|
|
|
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Operating expenses |
|
|
|
|
|
|
|
|
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Electric fuel and purchased power |
|
|
1,090 |
|
|
|
901 |
|
|
|
4,733 |
|
|
|
3,512 |
|
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Cost of natural gas sold and transported |
|
|
478 |
|
|
|
264 |
|
|
|
1,081 |
|
|
|
689 |
|
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Cost of sales — other |
|
|
10 |
|
|
|
9 |
|
|
|
38 |
|
|
|
37 |
|
|
Operating and maintenance expenses |
|
|
569 |
|
|
|
616 |
|
|
|
2,321 |
|
|
|
2,324 |
|
|
Conservation and demand side management expenses |
|
|
82 |
|
|
|
73 |
|
|
|
304 |
|
|
|
288 |
|
|
Depreciation and amortization |
|
|
535 |
|
|
|
499 |
|
|
|
2,121 |
|
|
|
1,948 |
|
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Taxes (other than income taxes) |
|
|
158 |
|
|
|
159 |
|
|
|
630 |
|
|
|
612 |
|
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Total operating expenses |
|
|
2,922 |
|
|
|
2,521 |
|
|
|
11,228 |
|
|
|
9,410 |
|
|
|
|
|
|
|
|
|
|
|
||||||||
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Operating income |
|
|
433 |
|
|
|
426 |
|
|
|
2,203 |
|
|
|
2,116 |
|
|
|
|
|
|
|
|
|
|
|
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Other income (expense), net |
|
|
— |
|
|
|
— |
|
|
|
5 |
|
|
|
(6 |
) |
|
Earnings from equity method investments |
|
|
15 |
|
|
|
11 |
|
|
|
62 |
|
|
|
40 |
|
|
Allowance for funds used during construction — equity |
|
|
20 |
|
|
|
24 |
|
|
|
73 |
|
|
|
115 |
|
|
|
|
|
|
|
|
|
|
|
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Interest charges and financing costs |
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|
|
|
|
|
|
|
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Interest charges — includes other financing costs of $8, $7, $29 and $28, respectively |
|
|
214 |
|
|
|
212 |
|
|
|
842 |
|
|
|
840 |
|
|
Allowance for funds used during construction — debt |
|
|
(8 |
) |
|
|
(9 |
) |
|
|
(26 |
) |
|
|
(42 |
) |
|
Total interest charges and financing costs |
|
|
206 |
|
|
|
203 |
|
|
|
816 |
|
|
|
798 |
|
|
|
|
|
|
|
|
|
|
|
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Income before income taxes |
|
|
262 |
|
|
|
258 |
|
|
|
1,527 |
|
|
|
1,467 |
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Income tax benefit |
|
|
(53 |
) |
|
|
(30 |
) |
|
|
(70 |
) |
|
|
(6 |
) |
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Net income |
|
$ |
315 |
|
|
$ |
288 |
|
|
$ |
1,597 |
|
|
$ |
1,473 |
|
|
|
|
|
|
|
|
|
|
|
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Weighted average common shares outstanding: |
|
|
|
|
|
|
|
|
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Basic |
|
|
541 |
|
|
|
530 |
|
|
|
539 |
|
|
|
527 |
|
|
Diluted |
|
|
542 |
|
|
|
532 |
|
|
|
540 |
|
|
|
528 |
|
|
|
|
|
|
|
|
|
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Earnings per average common share: |
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|
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Basic |
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$ |
0.58 |
|
|
$ |
0.54 |
|
|
$ |
2.96 |
|
|
$ |
2.79 |
|
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Diluted |
|
|
0.58 |
|
|
|
0.54 |
|
|
|
2.96 |
|
|
|
2.79 |
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XCEL ENERGY INC. AND SUBSIDIARIES
Notes to Investor Relations Earnings Release (Unaudited)
Due to the seasonality of Xcel Energy’s operating results, quarterly financial results are not an appropriate base from which to project annual results.
Non-GAAP Financial Measures
The following discussion includes financial information prepared in accordance with generally accepted accounting principles (GAAP), as well as certain non-GAAP financial measures such as ongoing return on equity (ROE), ongoing earnings and ongoing diluted EPS. Generally, a non-GAAP financial measure is a measure of a company’s financial performance, financial position or cash flows that adjusts measures calculated and presented in accordance with GAAP. Xcel Energy’s management uses non-GAAP measures for financial planning and analysis, for reporting of results to the Board of Directors, in determining performance-based compensation and communicating its earnings outlook to analysts and investors. Non-GAAP financial measures are intended to supplement investors’ understanding of our performance and should not be considered alternatives for financial measures presented in accordance with GAAP. These measures are discussed in more detail below and may not be comparable to other companies’ similarly titled non-GAAP financial measures.
Ongoing ROE
Ongoing ROE is calculated by dividing the net income or loss of Xcel Energy or each subsidiary, adjusted for certain nonrecurring items, by each entity’s average stockholder’s equity. We use these non-GAAP financial measures to evaluate and provide details of earnings results.
Earnings Adjusted for Certain Items (Ongoing Earnings and Ongoing Diluted EPS)
GAAP diluted EPS reflects the potential dilution that could occur if securities or other agreements to issue common stock (i.e., common stock equivalents) were settled. The weighted average number of potentially dilutive shares outstanding used to calculate Xcel Energy Inc.’s diluted EPS is calculated using the treasury stock method. Ongoing earnings reflect adjustments to GAAP earnings (net income) for certain items. Ongoing diluted EPS for Xcel Energy is calculated by dividing net income or loss, adjusted for certain items, by the weighted average fully diluted Xcel Energy Inc. common shares outstanding for the period. Ongoing diluted EPS for each subsidiary is calculated by dividing the net income or loss for such subsidiary, adjusted for certain items, by the weighted average fully diluted Xcel Energy Inc. common shares outstanding for the period.
We use these non-GAAP financial measures to evaluate and provide details of Xcel Energy’s core earnings and underlying performance. We believe these measurements are useful to investors to evaluate the actual and projected financial performance and contribution of our subsidiaries. For the three and twelve months ended Dec. 31, 2021 and 2020, there were no such adjustments to GAAP earnings and therefore GAAP earnings equal ongoing earnings for these periods.
Note 1. Earnings Per Share Summary
Xcel Energy’s 2021 earnings were $2.96 per share compared to $2.79 per share in 2020. The increase was driven by capital investment recovery and other regulatory outcomes, partially offset by increases in depreciation and lower AFUDC. Fluctuations in electric and natural gas revenues associated with changes in fuel and purchased power and/or natural gas sold and transported generally do not significantly impact earnings (changes in revenues are offset by the related variation in costs).
Summarized diluted EPS for Xcel Energy:
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Three Months Ended Dec. 31 |
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Twelve Months Ended Dec. 31 |
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Diluted Earnings (Loss) Per Share |
|
2021 |
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2020 |
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2021 |
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2020 |
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PSCo |
|
$ |
0.27 |
|
|
$ |
0.25 |
|
|
$ |
1.22 |
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$ |
1.11 |
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NSP-Minnesota |
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|
0.22 |
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|
|
0.23 |
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|
1.12 |
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|
|
1.12 |
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SPS |
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|
0.11 |
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|
|
0.10 |
|
|
|
0.59 |
|
|
|
0.56 |
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NSP-Wisconsin |
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|
0.05 |
|
|
|
0.04 |
|
|
|
0.20 |
|
|
|
0.20 |
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Earnings from equity method investments — WYCO |
|
|
0.01 |
|
|
|
0.01 |
|
|
|
0.05 |
|
|
|
0.05 |
|
|
Regulated utility (a) |
|
|
0.65 |
|
|
|
0.63 |
|
|
|
3.18 |
|
|
|
3.04 |
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Xcel Energy Inc. and Other |
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|
(0.06 |
) |
|
|
(0.09 |
) |
|
|
(0.22 |
) |
|
|
(0.25 |
) |
|
Total (a) |
|
$ |
0.58 |
|
|
$ |
0.54 |
|
|
$ |
2.96 |
|
|
$ |
2.79 |
|
(a) Amounts may not add due to rounding.
PSCo — Earnings increased $0.11 per share for 2021, driven by capital investment recovery and other regulatory outcomes. Higher revenues were partially offset by increased depreciation, operating and maintenance (O&M) expenses and other taxes (other than income taxes).
NSP-Minnesota — Earnings were flat for 2021 compared to 2020, reflecting capital investment recovery offset by additional depreciation and interest charges.
SPS — Earnings increased $0.03 per share for 2021, largely related to capital investment recovery and other regulatory outcomes, lower income tax, O&M and interest expenses, partially offset by decreased AFUDC.
NSP-Wisconsin — Earnings were flat for 2021 compared to 2020.
Xcel Energy Inc. and Other — Primarily includes financing costs at the holding company, offset by earnings from Energy Impact Partners (EIP) investments.
Components significantly contributing to changes in 2021 EPS compared with 2020:
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Diluted Earnings (Loss) Per Share |
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Three Months |
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Twelve Months |
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GAAP and ongoing diluted EPS — 2020 |
|
$ |
0.54 |
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$ |
2.79 |
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|
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Components of change — 2021 vs. 2020 |
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Higher electric revenues, net of electric fuel and purchased power |
|
|
— |
|
|
|
0.26 |
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Lower ETR (a) |
|
|
0.05 |
|
|
|
0.17 |
|
|
Higher natural gas revenues, net of cost of natural gas sold and transported |
|
|
— |
|
|
|
0.15 |
|
|
Lower O&M expenses |
|
|
0.07 |
|
|
|
— |
|
|
Changes in taxes (other than income taxes) |
|
|
0.01 |
|
|
|
(0.03 |
) |
|
Lower AFUDC |
|
|
(0.01 |
) |
|
|
(0.10 |
) |
|
Higher depreciation and amortization |
|
|
(0.05 |
) |
|
|
(0.24 |
) |
|
Other (net) |
|
|
(0.03 |
) |
|
|
(0.04 |
) |
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GAAP and ongoing diluted EPS — 2021 |
|
$ |
0.58 |
|
|
$ |
2.96 |
|
|
(a) |
Includes production tax credits (PTCs) and plant regulatory amounts, which are primarily offset as a reduction to electric revenues. |
ROE for Xcel Energy and its utility subsidiaries:
|
2021 |
|
NSP- |
|
PSCo |
|
SPS |
|
NSP- |
|
Operating |
|
Xcel Energy |
|
GAAP and ongoing ROE |
|
8.45 % |
|
8.23 % |
|
9.22 % |
|
9.92 % |
|
8.58 % |
|
10.58 % |
|
2020 |
|
NSP- |
|
PSCo |
|
SPS |
|
NSP- |
|
Operating |
|
Xcel Energy |
|
GAAP and ongoing ROE |
|
9.20 % |
|
8.06 % |
|
9.54 % |
|
10.52 % |
|
8.87 % |
|
10.59 % |
Note 2. Regulated Utility Results
Estimated Impact of Temperature Changes on Regulated Earnings — Unusually hot summers or cold winters increase electric and natural gas sales, while mild weather reduces electric and natural gas sales. The estimated impact of weather on earnings is based on the number of customers, temperature variances, the amount of natural gas or electricity historically used per degree of temperature and excludes any incremental related operating expenses that could result due to storm activity or vegetation management requirements. As a result, weather deviations from normal levels can affect Xcel Energy’s financial performance. However, sales true-up and decoupling mechanisms in Minnesota and Colorado predominately mitigate the positive and adverse impacts of weather.
Normal weather conditions are defined as either the 10, 20 or 30-year average of actual historical weather conditions. The historical period of time used in the calculation of normal weather differs by jurisdiction, based on regulatory practice. To calculate the impact of weather on demand, a demand factor is applied to the weather impact on sales. Extreme weather variations, windchill and cloud cover may not be reflected in weather-normalized estimates.
Weather — Estimated impact of temperature variations on EPS compared with normal weather conditions:
|
|
Three Months Ended Dec. 31 |
|
Twelve Months Ended Dec. 31 |
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|
2021 vs. |
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2020 vs. |
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2021 vs. 2020 |
|
2021 vs. |
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2020 vs. |
|
2021 vs. 2020 |
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|
Retail electric |
$ |
(0.026 |
) |
|
$ |
(0.005 |
) |
|
$ |
(0.021 |
) |
|
$ |
0.096 |
|
|
$ |
0.090 |
|
|
$ |
0.006 |
|
|
Decoupling and sales true-up |
|
0.011 |
|
|
|
0.003 |
|
|
|
0.008 |
|
|
|
(0.066 |
) |
|
|
(0.041 |
) |
|
|
(0.025 |
) |
|
Electric total |
$ |
(0.015 |
) |
|
$ |
(0.002 |
) |
|
$ |
(0.013 |
) |
|
$ |
0.030 |
|
|
$ |
0.049 |
|
|
$ |
(0.019 |
) |
|
Firm natural gas |
|
(0.030 |
) |
|
|
(0.006 |
) |
|
|
(0.024 |
) |
|
|
(0.025 |
) |
|
|
(0.011 |
) |
|
|
(0.014 |
) |
|
Total |
$ |
(0.045 |
) |
|
$ |
(0.008 |
) |
|
$ |
(0.037 |
) |
|
$ |
0.005 |
|
|
$ |
0.038 |
|
|
$ |
(0.033 |
) |
Sales — Sales growth (decline) for actual and weather-normalized sales in 2021 compared to 2020:
|
|
|
Three Months Ended Dec. 31 |
|||||||||||||
|
|
|
PSCo |
|
NSP-Minnesota |
|
SPS |
|
NSP-Wisconsin |
|
Xcel Energy |
|||||
|
Actual |
|
|
|
|
|
|
|
|
|
|
|||||
|
Electric residential |
|
(6.6 |
)% |
|
(2.2 |
)% |
|
(13.7 |
)% |
|
(3.1 |
)% |
|
(5.6 |
)% |
|
Electric C&I |
|
(1.4 |
) |
|
2.9 |
|
|
7.1 |
|
|
3.7 |
|
|
2.7 |
|
|
Total retail electric sales |
|
(3.2 |
) |
|
1.2 |
|
|
3.2 |
|
|
1.6 |
|
|
0.3 |
|
|
Firm natural gas sales |
|
(16.2 |
) |
|
(8.2 |
) |
|
N/A |
|
|
(12.7 |
) |
|
(13.5 |
) |
|
|
|
Three Months Ended Dec. 31 |
|||||||||||||
|
|
|
PSCo |
|
NSP-Minnesota |
|
SPS |
|
NSP-Wisconsin |
|
Xcel Energy |
|||||
|
Weather-normalized |
|
|
|
|
|
|
|
|
|
|
|||||
|
Electric residential |
|
(2.1 |
)% |
|
(1.4 |
)% |
|
(5.3 |
)% |
|
(2.0 |
)% |
|
(2.3 |
)% |
|
Electric C&I |
|
(1.0 |
) |
|
2.5 |
|
|
7.3 |
|
|
3.6 |
|
|
2.8 |
|
|
Total retail electric sales |
|
(1.4 |
) |
|
1.2 |
|
|
4.8 |
|
|
1.9 |
|
|
1.3 |
|
|
Firm natural gas sales |
|
(0.6 |
) |
|
(4.4 |
) |
|
N/A |
|
|
(9.9 |
) |
|
(2.3 |
) |
|
|
|
Twelve Months Ended Dec. 31 |
|||||||||||||
|
|
|
PSCo |
|
NSP-Minnesota |
|
SPS |
|
NSP-Wisconsin |
|
Xcel Energy |
|||||
|
Actual |
|
|
|
|
|
|
|
|
|
|
|||||
|
Electric residential |
|
— |
% |
|
2.2 |
% |
|
(4.7 |
)% |
|
0.5 |
% |
|
0.3 |
% |
|
Electric C&I |
|
0.4 |
|
|
2.3 |
|
|
2.9 |
|
|
3.6 |
|
|
2.0 |
|
|
Total retail electric sales |
|
0.3 |
|
|
2.2 |
|
|
1.4 |
|
|
2.7 |
|
|
1.4 |
|
|
Firm natural gas sales |
|
(1.1 |
) |
|
(4.0 |
) |
|
N/A |
|
|
(5.0 |
) |
|
(2.2 |
) |
|
|
|
Twelve Months Ended Dec. 31 |
|||||||||||||
|
|
|
PSCo |
|
NSP-Minnesota |
|
SPS |
|
NSP-Wisconsin |
|
Xcel Energy |
|||||
|
Weather-normalized |
|
|
|
|
|
|
|
|
|
|
|||||
|
Electric residential |
|
1.5 |
% |
|
0.3 |
% |
|
(1.0 |
)% |
|
(0.2 |
)% |
|
0.5 |
% |
|
Electric C&I |
|
0.4 |
|
|
1.7 |
|
|
3.3 |
|
|
3.3 |
|
|
1.9 |
|
|
Total retail electric sales |
|
0.8 |
|
|
1.2 |
|
|
2.5 |
|
|
2.2 |
|
|
1.4 |
|
|
Firm natural gas sales |
|
1.3 |
|
|
(2.2 |
) |
|
N/A |
|
|
(4.1 |
) |
|
(0.1 |
) |
|
|
|
Twelve Months Ended Dec. 31 (2020 Leap Year Adjusted) |
|||||||||||||
|
|
|
PSCo |
|
NSP-Minnesota |
|
SPS |
|
NSP-Wisconsin |
|
Xcel Energy |
|||||
|
Weather-normalized |
|
|
|
|
|
|
|
|
|
|
|||||
|
Electric residential |
|
1.7 |
% |
|
0.6 |
% |
|
(0.7 |
)% |
|
0.1 |
% |
|
0.8 |
% |
|
Electric C&I |
|
0.7 |
|
|
1.9 |
|
|
3.6 |
|
|
3.6 |
|
|
2.1 |
|
|
Total retail electric sales |
|
1.1 |
|
|
1.5 |
|
|
2.7 |
|
|
2.5 |
|
|
1.7 |
|
|
Firm natural gas sales |
|
1.8 |
|
|
(1.7 |
) |
|
N/A |
|
|
(3.6 |
) |
|
0.4 |
|
Weather-normalized and leap-year adjusted electric sales growth (decline) — year-to-date
Weather-adjusted sales results for each of our utility subsidiaries in 2021 reflect improving economies as the adverse effects of COVID-19 lessen. The recovery reflects increased sales in the C&I sector as businesses return to a more normal level. Residential sales remain elevated from pre-pandemic levels due to continuance of individuals working from home.
- PSCo — Residential sales rose based on a 1.2% increase in customers, combined with higher use per customer. The growth in C&I sales was due to a 1.2% increase in customers, partially offset by slightly lower use per customer, primarily in the services sector.
- NSP-Minnesota — Residential sales growth reflects a 1.2% increase in customers, partially offset by a lower use per customer. The growth in C&I sales was due to a 0.9% increase in customers and higher use per customer, primarily in the manufacturing, retail and services sectors.
- SPS — Residential sales declined as lower use per customer offset a 0.9% increase in customers. C&I sales increased due to a 0.5% increase in customers and higher use per customer, primarily driven by the oil and gas and professional services sectors.
- NSP-Wisconsin — Residential sales growth was attributable to a 0.8% increase in customer additions, partially offset by slightly lower use per customer. The growth in C&I sales was due to a 1.1% increase in customers, primarily led by increases in the manufacturing, health care and retail trade sectors.
Weather-normalized and leap-year adjusted natural gas sales growth (decline) — year-to-date
- Natural gas sales primarily reflect a 1.2% increase in residential customers and a 0.5% increase in C&I customers, partially offset by a decrease in use per customer.
Electric Margin — Electric margin is presented as electric revenues less electric fuel and purchased power expenses. Expenses incurred for electric fuel and purchased power are generally recovered through various regulatory recovery mechanisms. As a result, changes in these expenses are generally offset in operating revenues.
Electric revenues and fuel and purchased power expenses are impacted by fluctuations in the price of natural gas, coal and uranium. However, these price fluctuations generally have minimal impact on earnings impact due to fuel recovery mechanisms. In addition, electric customers receive a credit for PTCs generated, which reduce electric revenue and income taxes. See Note 5 for discussion of Winter Storm Uri.
Electric revenues, fuel and purchased power and margin:
|
|
|
Three Months Ended Dec. 31 |
|
Twelve Months Ended Dec. 31 |
||||||||||||
|
(Millions of Dollars) |
|
2021 |
|
2020 |
|
2021 |
|
2020 |
||||||||
|
Electric revenues |
|
$ |
2,562 |
|
|
$ |
2,372 |
|
|
$ |
11,205 |
|
|
$ |
9,802 |
|
|
Electric fuel and purchased power |
|
|
(1,090 |
) |
|
|
(901 |
) |
|
|
(4,733 |
) |
|
|
(3,512 |
) |
|
Electric margin |
|
$ |
1,472 |
|
|
$ |
1,471 |
|
|
$ |
6,472 |
|
|
$ |
6,290 |
|
Change in electric margin:
|
(Millions of Dollars) |
|
Three Months |
|
Twelve Months |
||||
|
Non-fuel riders |
|
$ |
22 |
|
|
$ |
221 |
|
|
Regulatory rate outcomes (Texas, Wisconsin, Colorado, New Mexico and North Dakota) |
|
|
8 |
|
|
|
114 |
|
|
Proprietary commodity trading, net of sharing (a) |
|
|
(8 |
) |
|
|
40 |
|
|
Sales and demand (b) |
|
|
9 |
|
|
|
29 |
|
|
PTCs flowed back to customers (offset by lower ETR) |
|
|
(37 |
) |
|
|
(149 |
) |
|
Texas 2019 rate case surcharge (c) |
|
|
— |
|
|
|
(70 |
) |
|
Estimated impact of weather (net of decoupling/sales true-up) |
|
|
(9 |
) |
|
|
(12 |
) |
|
Other (net) |
|
|
16 |
|
|
|
9 |
|
|
Increase in electric margin |
|
$ |
1 |
|
|
$ |
182 |
|
|
(a) |
Includes $27 million of net gains previously recognized in the first quarter of 2021, driven by market changes associated with Winter Storm Uri. Additional amounts are primarily related to long-term physical generation contracts, which have increased in value as a result of higher energy prices. |
|
|
(b) |
Sales excludes weather impact, net of decoupling/sales true-up, and demand is net of sales true-up. |
|
|
(c) |
Impact is due to the Texas rate case outcome, which resulted in a revenue increase that was recognized in the third quarter of 2020 (largely offset by recognition of previously deferred costs). |
Natural Gas Margin — Natural gas margin is presented as natural gas revenues less the cost of natural gas sold and transported. Expenses incurred for the cost of natural gas sold are generally recovered through various regulatory recovery mechanisms. As a result, changes in these expenses are generally offset in operating revenues.
Natural gas expense varies with changing sales and the cost of natural gas. However, fluctuations in the cost of natural gas generally have minimal earnings impact due to cost recovery mechanisms. See Note 5 for discussion of Winter Storm Uri.
Natural gas revenues, cost of natural gas sold and transported and margin:
|
|
|
Three Months Ended Dec. 31 |
|
Twelve Months Ended Dec. 31 |
||||||||||||
|
(Millions of Dollars) |
|
2021 |
|
2020 |
|
2021 |
|
2020 |
||||||||
|
Natural gas revenues |
|
$ |
768 |
|
|
$ |
554 |
|
|
$ |
2,132 |
|
|
$ |
1,636 |
|
|
Cost of natural gas sold and transported |
|
|
(478 |
) |
|
|
(264 |
) |
|
|
(1,081 |
) |
|
|
(689 |
) |
|
Natural gas margin |
|
$ |
290 |
|
|
$ |
290 |
|
|
$ |
1,051 |
|
|
$ |
947 |
|
Change in natural gas margin:
|
(Millions of Dollars) |
|
Three Months |
|
Twelve Months |
||||
|
Regulatory rate outcomes (Colorado and North Dakota) |
|
$ |
7 |
|
|
$ |
90 |
|
|
Infrastructure and integrity riders |
|
|
4 |
|
|
|
12 |
|
|
Conservation incentive |
|
|
2 |
|
|
|
3 |
|
|
Estimated impact of weather |
|
|
(17 |
) |
|
|
(10 |
) |
|
Other (net) |
|
|
4 |
|
|
|
9 |
|
|
Change |
|
$ |
— |
|
|
$ |
104 |
|
O&M Expenses — O&M expenses decreased $3 million year-to-date. Increases for distribution, wind farm maintenance and technology costs were offset by a decrease in employee benefits expense (e.g., long-term incentives), additional Texas 2021 rate case deferrals and the year-over-year impact of amounts associated with the Texas 2019 rate case surcharge.
Depreciation and Amortization — Depreciation and amortization increased $173 million year-to-date. The increase was primarily driven by several wind farms going into service, normal system expansion and the implementation of new depreciation rates in various states.
Other Income (Expense) — Other income (expense) increased $11 million year-to-date.
Contacts
Paul Johnson, Vice President – Treasurer & Investor Relations, (612) 215-4535
For news media inquiries only, please call Xcel Energy Media Relations, (612) 215-5300
Xcel Energy website address: www.xcelenergy.com
