x
|
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
o
|
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
Minnesota
|
41-1967505
|
|
(State or other jurisdiction of incorporation or organization)
|
(I.R.S. Employer Identification No.)
|
|
414 Nicollet Mall
|
||
Minneapolis, Minnesota
|
55401
|
|
(Address of principal executive offices)
|
(Zip Code)
|
Large accelerated filer o
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Accelerated filer o
|
|
Non-accelerated filer x
|
Smaller reporting company o
|
|
(Do not check if smaller reporting company)
|
Class
|
Outstanding at Oct. 26, 2012
|
|
Common Stock, $0.01 par value
|
1,000,000 shares
|
PART I — FINANCIAL INFORMATION
|
||
Item l —
|
3
|
|
Item 2 —
|
28
|
|
Item 4 —
|
33
|
|
PART II — OTHER INFORMATION
|
||
Item 1 —
|
34
|
|
Item 1A —
|
34
|
|
Item 4 —
|
34
|
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Item 5 —
|
34
|
|
Item 6 —
|
34
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35
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Certifications Pursuant to Section 302
|
1
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Certifications Pursuant to Section 906
|
1
|
Statement Pursuant to Private Litigation
|
1
|
Three Months Ended Sept. 30
|
Nine Months Ended Sept. 30
|
|||||||||||||||
2012
|
2011
|
2012
|
2011
|
|||||||||||||
Operating revenues
|
||||||||||||||||
Electric
|
$ | 1,130,207 | $ | 1,103,875 | $ | 2,912,641 | $ | 2,916,082 | ||||||||
Natural gas
|
49,522 | 58,914 | 305,105 | 439,562 | ||||||||||||
Other
|
5,671 | 5,349 | 16,963 | 15,912 | ||||||||||||
Total operating revenues
|
1,185,400 | 1,168,138 | 3,234,709 | 3,371,556 | ||||||||||||
Operating expenses
|
||||||||||||||||
Electric fuel and purchased power
|
448,681 | 428,333 | 1,176,155 | 1,181,007 | ||||||||||||
Cost of natural gas sold and transported
|
19,420 | 28,532 | 179,155 | 286,744 | ||||||||||||
Cost of sales — other
|
3,581 | 3,341 | 9,670 | 9,132 | ||||||||||||
Operating and maintenance expenses
|
270,403 | 266,451 | 803,044 | 783,291 | ||||||||||||
Conservation program expenses
|
28,408 | 33,594 | 78,579 | 102,006 | ||||||||||||
Depreciation and amortization
|
105,891 | 111,436 | 304,794 | 316,264 | ||||||||||||
Taxes (other than income taxes)
|
49,269 | 40,580 | 151,411 | 126,567 | ||||||||||||
Total operating expenses
|
925,653 | 912,267 | 2,702,808 | 2,805,011 | ||||||||||||
Operating income
|
259,747 | 255,871 | 531,901 | 566,545 | ||||||||||||
Other (expense) income, net
|
(328 | ) | 102 | 1,195 | 1,781 | |||||||||||
Allowance for funds used during construction — equity
|
9,886 | 8,700 | 27,100 | 28,439 | ||||||||||||
Interest charges and financing costs
|
||||||||||||||||
Interest charges — includes other financing costs of
$1,501, $1,636, $4,454 and $4,678, respectively
|
52,080 | 52,069 | 156,482 | 155,997 | ||||||||||||
(5,757 | ) | (4,753 | ) | (14,972 | ) | (16,037 | ) | |||||||||
Total interest charges and financing costs
|
46,323 | 47,316 | 141,510 | 139,960 | ||||||||||||
Income before income taxes
|
222,982 | 217,357 | 418,686 | 456,805 | ||||||||||||
Income taxes
|
86,971 | 75,455 | 141,377 | 157,505 | ||||||||||||
Net income
|
$ | 136,011 | $ | 141,902 | $ | 277,309 | $ | 299,300 |
Three Months Ended Sept. 30
|
Nine Months Ended Sept. 30
|
|||||||||||||||
2012
|
2011
|
2012
|
2011
|
|||||||||||||
Net income
|
$ | 136,011 | $ | 141,902 | $ | 277,309 | $ | 299,300 | ||||||||
Other comprehensive loss
|
||||||||||||||||
Pension and retiree medical benefits:
|
||||||||||||||||
Amortization of losses included in net periodic benefit cost,
net of tax of $23, $27, $79 and $75, respectively
|
45 | 34 | 126 | 102 | ||||||||||||
Derivative instruments:
|
||||||||||||||||
Net fair value decrease, net of tax of $(3,716),
$(9,036), $(6,879) and $(8,964), respectively
|
(5,277 | ) | (13,112 | ) | (9,874 | ) | (13,007 | ) | ||||||||
Reclassification of losses (gains) to net income, net of tax of
$72, $(23), $27 and $(67), respectively
|
100 | (34 | ) | 33 | (95 | ) | ||||||||||
(5,177 | ) | (13,146 | ) | (9,841 | ) | (13,102 | ) | |||||||||
Marketable securities:
|
||||||||||||||||
Net fair value (decrease) increase, net of tax of
$(30), $41, $89 and $76, respectively
|
(45 | ) | 59 | 129 | 109 | |||||||||||
Other comprehensive loss
|
(5,177 | ) | (13,053 | ) | (9,586 | ) | (12,891 | ) | ||||||||
Comprehensive income
|
$ | 130,834 | $ | 128,849 | $ | 267,723 | $ | 286,409 |
Nine Months Ended Sept. 30
|
||||||||
2012
|
2011
|
|||||||
Operating activities
|
||||||||
Net income
|
$ | 277,309 | $ | 299,300 | ||||
Adjustments to reconcile net income to cash provided by operating activities:
|
||||||||
Depreciation and amortization
|
308,421 | 320,295 | ||||||
Nuclear fuel amortization
|
79,171 | 75,292 | ||||||
Deferred income taxes
|
146,578 | 136,672 | ||||||
Amortization of investment tax credits
|
(2,026 | ) | (2,021 | ) | ||||
Allowance for equity funds used during construction
|
(27,100 | ) | (28,439 | ) | ||||
Net realized and unrealized hedging and derivative transactions
|
(53,887 | ) | 711 | |||||
Changes in operating assets and liabilities:
|
||||||||
Accounts receivable
|
(153,483 | ) | (4,855 | ) | ||||
Accrued unbilled revenues
|
54,977 | 65,382 | ||||||
Inventories
|
36,492 | (2,621 | ) | |||||
Other current assets
|
(20,088 | ) | 10,382 | |||||
Accounts payable
|
(13,584 | ) | (51,371 | ) | ||||
Net regulatory assets and liabilities
|
(381 | ) | 108,126 | |||||
Other current liabilities
|
(34,971 | ) | 19,929 | |||||
Pension and other employee benefit obligations
|
(70,987 | ) | (44,394 | ) | ||||
Change in other noncurrent assets
|
(16,248 | ) | (1,600 | ) | ||||
Change in other noncurrent liabilities
|
(2,937 | ) | (30,875 | ) | ||||
Net cash provided by operating activities
|
507,256 | 869,913 | ||||||
Investing activities
|
||||||||
Utility capital/construction expenditures
|
(820,098 | ) | (809,953 | ) | ||||
Proceeds from insurance recoveries
|
56,892 | - | ||||||
Merricourt refund
|
- | 101,261 | ||||||
Merricourt deposit
|
- | (90,833 | ) | |||||
Allowance for equity funds used during construction
|
27,100 | 28,439 | ||||||
Purchases of investments in external decommissioning fund
|
(501,009 | ) | (1,741,907 | ) | ||||
Proceeds from the sale of investments in external decommissioning fund
|
501,009 | 1,741,909 | ||||||
Investments in utility money pool arrangement
|
- | (432,000 | ) | |||||
Repayments from utility money pool arrangement
|
- | 432,000 | ||||||
Advances to affiliate
|
- | (111,300 | ) | |||||
Advances from affiliate
|
- | 148,300 | ||||||
Change in restricted cash
|
95,287 | (100,007 | ) | |||||
Other, net
|
(894 | ) | (3,946 | ) | ||||
Net cash used in investing activities
|
(641,713 | ) | (838,037 | ) | ||||
Financing activities
|
||||||||
Repayments of short-term borrowings, net
|
(26,000 | ) | - | |||||
Borrowings under utility money pool arrangement
|
889,000 | 253,600 | ||||||
Repayments under utility money pool arrangement
|
(834,000 | ) | (184,600 | ) | ||||
Proceeds from issuance of long-term debt
|
786,852 | - | ||||||
Repayments of long-term debt, including reacquisition premiums
|
(648,869 | ) | (30 | ) | ||||
Capital contributions from parent
|
145,621 | 125,000 | ||||||
Dividends paid to parent
|
(175,104 | ) | (232,510 | ) | ||||
Net cash provided by (used in) financing activities
|
137,500 | (38,540 | ) | |||||
Net change in cash and cash equivalents
|
3,043 | (6,664 | ) | |||||
Cash and cash equivalents at beginning of period
|
26,005 | 38,408 | ||||||
Cash and cash equivalents at end of period
|
$ | 29,048 | $ | 31,744 | ||||
Supplemental disclosure of cash flow information:
|
||||||||
Cash paid for interest (net of amounts capitalized)
|
$ | (171,697 | ) | $ | (162,167 | ) | ||
Cash paid for income taxes, net
|
(49,446 | ) | (19,654 | ) | ||||
Supplemental disclosure of non-cash investing transactions:
|
||||||||
Property, plant and equipment additions in accounts payable
|
$ | 98,100 | $ | 23,436 |
Sept. 30, 2012
|
Dec. 31, 2011
|
|||||||
Current assets
|
||||||||
Cash and cash equivalents
|
$ | 29,048 | $ | 26,005 | ||||
Restricted cash
|
- | 95,287 | ||||||
Accounts receivable, net
|
303,402 | 314,577 | ||||||
Accounts receivable from affiliates
|
17,641 | 18,033 | ||||||
Accrued unbilled revenues
|
176,326 | 231,303 | ||||||
Inventories
|
265,356 | 301,848 | ||||||
Regulatory assets
|
147,146 | 141,709 | ||||||
Derivative instruments
|
65,649 | 51,517 | ||||||
Prepayments and other
|
104,049 | 45,219 | ||||||
Total current assets
|
1,108,617 | 1,225,498 | ||||||
Property, plant and equipment, net
|
9,419,119 | 8,982,834 | ||||||
Other assets
|
||||||||
Nuclear decommissioning fund and other investments
|
1,474,962 | 1,357,538 | ||||||
Regulatory assets
|
883,186 | 872,014 | ||||||
Derivative instruments
|
72,860 | 80,689 | ||||||
Other
|
58,292 | 36,638 | ||||||
Total other assets
|
2,489,300 | 2,346,879 | ||||||
Total assets
|
$ | 13,017,036 | $ | 12,555,211 | ||||
Liabilities and Equity
|
||||||||
Current liabilities
|
||||||||
Current portion of long-term debt
|
$ | 5 | $ | 450,000 | ||||
Short-term debt
|
- | 26,000 | ||||||
Borrowings under utility money pool arrangement
|
120,000 | 65,000 | ||||||
Accounts payable
|
378,187 | 322,979 | ||||||
Accounts payable to affiliates
|
50,911 | 47,651 | ||||||
Regulatory liabilities
|
90,072 | 132,574 | ||||||
Taxes accrued
|
129,916 | 158,319 | ||||||
Accrued interest
|
36,134 | 68,362 | ||||||
Dividends payable to parent
|
59,004 | 58,054 | ||||||
Derivative instruments
|
21,118 | 65,781 | ||||||
Provision for rate refund
|
1,728 | 69,746 | ||||||
Other
|
91,843 | 94,990 | ||||||
Total current liabilities
|
978,918 | 1,559,456 | ||||||
Deferred credits and other liabilities
|
||||||||
Deferred income taxes
|
1,877,515 | 1,666,005 | ||||||
Deferred investment tax credits
|
30,701 | 31,743 | ||||||
Regulatory liabilities
|
425,868 | 439,029 | ||||||
Asset retirement obligations
|
1,643,661 | 1,581,896 | ||||||
Derivative instruments
|
177,187 | 184,190 | ||||||
Pension and employee benefit obligations
|
342,416 | 413,755 | ||||||
Other
|
90,248 | 65,464 | ||||||
Total deferred credits and other liabilities
|
4,587,596 | 4,382,082 | ||||||
Commitments and contingencies
|
||||||||
Capitalization
|
||||||||
Long-term debt
|
3,488,456 | 2,888,897 | ||||||
Common stock – authorized 5,000,000 shares of $0.01 par value; 1,000,000 shares
outstanding at Sept. 30, 2012 and Dec. 31, 2011, respectively
|
10 | 10 | ||||||
Additional paid in capital
|
2,512,012 | 2,366,391 | ||||||
Retained earnings
|
1,473,982 | 1,372,727 | ||||||
Accumulated other comprehensive loss
|
(23,938 | ) | (14,352 | ) | ||||
Total common stockholder's equity
|
3,962,066 | 3,724,776 | ||||||
Total liabilities and equity
|
$ | 13,017,036 | $ | 12,555,211 |
1. | Summary of Significant Accounting Policies |
2. | Accounting Pronouncements |
3.
|
Selected Balance Sheet Data
|
(Thousands of Dollars)
|
Sept. 30, 2012
|
Dec. 31, 2011
|
||||||
Accounts receivable, net
|
||||||||
Accounts receivable
|
$ | 321,652 | $ | 337,581 | ||||
Less allowance for bad debts
|
(18,250 | ) | (23,004 | ) | ||||
$ | 303,402 | $ | 314,577 |
(Thousands of Dollars)
|
Sept. 30, 2012
|
Dec. 31, 2011
|
||||||
Inventories
|
||||||||
Materials and supplies
|
$ | 133,539 | $ | 124,961 | ||||
Fuel
|
86,312 | 113,711 | ||||||
Natural gas
|
45,505 | 63,176 | ||||||
$ | 265,356 | $ | 301,848 |
(Thousands of Dollars)
|
Sept. 30, 2012
|
Dec. 31, 2011
|
||||||
Property, plant and equipment, net
|
||||||||
Electric plant
|
$ | 12,195,850 | $ | 11,948,041 | ||||
Natural gas plant
|
1,019,175 | 1,006,163 | ||||||
Common and other property
|
475,491 | 525,139 | ||||||
Construction work in progress
|
916,198 | 639,246 | ||||||
Total property, plant and equipment
|
14,606,714 | 14,118,589 | ||||||
Less accumulated depreciation
|
(5,541,918 | ) | (5,433,106 | ) | ||||
Nuclear fuel
|
2,075,442 | 1,939,299 | ||||||
Less accumulated amortization
|
(1,721,119 | ) | (1,641,948 | ) | ||||
$ | 9,419,119 | $ | 8,982,834 |
4.
|
Income Taxes
|
(Millions of Dollars)
|
Sept. 30, 2012
|
Dec. 31, 2011
|
||||||
Unrecognized tax benefit — Permanent tax positions
|
$ | 2.8 | $ | 3.3 | ||||
Unrecognized tax benefit — Temporary tax positions
|
17.7 | 13.4 | ||||||
Total unrecognized tax benefit
|
$ | 20.5 | $ | 16.7 |
(Millions of Dollars)
|
Sept. 30, 2012
|
Dec. 31, 2011
|
||||||
NOL and tax credit carryforwards
|
$ | (16.4 | ) | $ | (18.1 | ) |
5.
|
Rate Matters
|
·
|
A rate increase of approximately $58 million in 2011 and an incremental rate increase of $14.8 million in 2012 based on an ROE of 10.37 percent and an equity ratio of 52.56 percent.
|
·
|
A reduction to depreciation expense and NSP-Minnesota's rate request by $30 million.
|
6.
|
Commitments and Contingencies
|
7.
|
Borrowings and Other Financing Instruments
|
(Amounts in Millions, Except Interest Rates)
|
Three Months Ended
Sept. 30, 2012
|
Twelve Months Ended
Dec. 31, 2011
|
|||||||
Borrowing limit
|
$
|
500
|
$
|
500
|
|||||
Amount outstanding at period end
|
-
|
26
|
|||||||
Average amount outstanding
|
2
|
7
|
|||||||
Maximum amount outstanding
|
37
|
80
|
|||||||
Weighted average interest rate, computed on a daily basis
|
0.41
|
% |
0.34
|
% |
|
||||
Weighted average interest rate at period end
|
N/A
|
0.45
|
Credit Facility
|
Drawn (a)
|
Available
|
||||||||
$ | 500.0 | $ | 8.7 | $ | 491.3 |
(a)
|
Includes outstanding letters of credit.
|
(Amounts in Millions, Except Interest Rates)
|
Three Months Ended
Sept. 30, 2012
|
Twelve Months Ended
Dec. 31, 2011
|
||||||||
Borrowing limit
|
$
|
250
|
$
|
250
|
||||||
Amount outstanding at period end
|
120
|
65
|
||||||||
Average amount outstanding
|
94
|
17
|
||||||||
Maximum amount outstanding
|
236
|
80
|
||||||||
Weighted average interest rate, computed on a daily basis
|
0.33
|
% |
|
0.34
|
% |
|
||||
Weighted average interest rate at period end
|
0.32
|
0.35
|
8.
|
Fair Value of Financial Assets and Liabilities
|
Sept. 30, 2012
|
||||||||||||||||||||
Fair Value
|
||||||||||||||||||||
(Thousands of Dollars)
|
Cost
|
Level 1
|
Level 2
|
Level 3
|
Total
|
|||||||||||||||
Nuclear decommissioning fund (a)
|
||||||||||||||||||||
Cash equivalents
|
$ | 28,835 | $ | 16,074 | $ | 12,761 | $ | - | $ | 28,835 | ||||||||||
Commingled funds
|
375,958 | - | 398,592 | - | 398,592 | |||||||||||||||
International equity funds
|
65,713 | - | 66,518 | - | 66,518 | |||||||||||||||
Private equity investments
|
20,662 | - | - | 24,073 | 24,073 | |||||||||||||||
Real estate
|
30,252 | - | - | 35,233 | 35,233 | |||||||||||||||
Debt securities:
|
||||||||||||||||||||
Government securities
|
126,381 | - | 127,124 | - | 127,124 | |||||||||||||||
U.S. corporate bonds
|
153,283 | - | 164,501 | - | 164,501 | |||||||||||||||
International corporate bonds
|
24,952 | - | 26,442 | - | 26,442 | |||||||||||||||
Municipal bonds
|
61,683 | - | 66,800 | - | 66,800 | |||||||||||||||
Asset-backed securities
|
4,971 | - | - | 4,995 | 4,995 | |||||||||||||||
Mortgage-backed securities
|
60,628 | - | - | 63,957 | 63,957 | |||||||||||||||
Equity securities:
|
||||||||||||||||||||
Common stock
|
402,769 | 445,891 | - | - | 445,891 | |||||||||||||||
Total
|
$ | 1,356,087 | $ | 461,965 | $ | 862,738 | $ | 128,258 | $ | 1,452,961 |
(a)
|
Reported in nuclear decommissioning fund and other investments on the consolidated balance sheet, which also includes $22.0 million of miscellaneous investments.
|
Dec. 31, 2011
|
||||||||||||||||||||
Fair Value
|
||||||||||||||||||||
(Thousands of Dollars)
|
Cost
|
Level 1
|
Level 2
|
Level 3
|
Total
|
|||||||||||||||
Nuclear decommissioning fund (a)
|
||||||||||||||||||||
Cash equivalents
|
$ | 26,123 | $ | 7,103 | $ | 19,020 | $ | - | $ | 26,123 | ||||||||||
Commingled funds
|
320,798 | - | 311,105 | - | 311,105 | |||||||||||||||
International equity funds
|
63,781 | - | 58,508 | - | 58,508 | |||||||||||||||
Private equity investments
|
9,203 | - | - | 9,203 | 9,203 | |||||||||||||||
Real estate
|
24,768 | - | - | 26,395 | 26,395 | |||||||||||||||
Debt securities:
|
||||||||||||||||||||
Government securities
|
116,490 | - | 117,256 | - | 117,256 | |||||||||||||||
U.S. corporate bonds
|
187,083 | - | 193,516 | - | 193,516 | |||||||||||||||
International corporate bonds
|
35,198 | - | 35,804 | - | 35,804 | |||||||||||||||
Municipal bonds
|
60,469 | - | 64,731 | - | 64,731 | |||||||||||||||
Asset-backed securities
|
16,516 | - | - | 16,501 | 16,501 | |||||||||||||||
Mortgage-backed securities
|
75,627 | - | - | 78,664 | 78,664 | |||||||||||||||
Equity securities:
|
||||||||||||||||||||
Common stock
|
408,122 | 398,625 | - | - | 398,625 | |||||||||||||||
Total
|
$ | 1,344,178 | $ | 405,728 | $ | 799,940 | $ | 130,763 | $ | 1,336,431 |
(a)
|
Reported in nuclear decommissioning fund and other investments on the consolidated balance sheet, which also includes $21.1 million of miscellaneous investments.
|
Gains Recognized
|
||||||||||||||||||||
as Regulatory
|
||||||||||||||||||||
(Thousands of Dollars)
|
July 1, 2012
|
Purchases
|
Settlements
|
Liabilities
|
Sept. 30, 2012
|
|||||||||||||||
Private equity investments
|
$ | 23,303 | $ | - | $ | (1,931 | ) | $ | 2,701 | $ | 24,073 | |||||||||
Real estate
|
32,721 | 2,882 | (1,165 | ) | 795 | 35,233 | ||||||||||||||
Asset-backed securities
|
7,068 | - | (2,085 | ) | 12 | 4,995 | ||||||||||||||
Mortgage-backed securities
|
66,321 | 16,782 | (19,681 | ) | 535 | 63,957 | ||||||||||||||
Total
|
$ | 129,413 | $ | 19,664 | $ | (24,862 | ) | $ | 4,043 | $ | 128,258 |
Losses
|
||||||||||||||||||||
Recognized as
|
||||||||||||||||||||
(Thousands of Dollars)
|
July 1, 2011
|
Purchases
|
Settlements
|
Regulatory Assets
|
Sept. 30, 2011
|
|||||||||||||||
Asset-backed securities
|
$ | 21,004 | $ | 9,496 | $ | (19,443 | ) | $ | (811 | ) | $ | 10,246 | ||||||||
Mortgage-backed securities
|
62,271 | 1,972 | (8,978 | ) | (450 | ) | 54,815 | |||||||||||||
Total
|
$ | 83,275 | $ | 11,468 | $ | (28,421 | ) | $ | (1,261 | ) | $ | 65,061 |
Gains Recognized
|
||||||||||||||||||||
as Regulatory
|
||||||||||||||||||||
(Thousands of Dollars)
|
Jan. 1, 2012
|
Purchases
|
Settlements
|
Liabilities
|
Sept. 30, 2012
|
|||||||||||||||
Private equity investments
|
$ | 9,203 | $ | 13,390 | $ | (1,931 | ) | $ | 3,411 | $ | 24,073 | |||||||||
Real estate
|
26,395 | 6,789 | (2,931 | ) | 4,980 | 35,233 | ||||||||||||||
Asset-backed securities
|
16,501 | - | (11,544 | ) | 38 | 4,995 | ||||||||||||||
Mortgage-backed securities
|
78,664 | 31,100 | (46,099 | ) | 292 | 63,957 | ||||||||||||||
Total
|
$ | 130,763 | $ | 51,279 | $ | (62,505 | ) | $ | 8,721 | $ | 128,258 |
Losses
|
||||||||||||||||||||
Recognized as
|
||||||||||||||||||||
(Thousands of Dollars)
|
Jan. 1, 2011
|
Purchases
|
Settlements
|
Regulatory Assets
|
Sept. 30, 2011
|
|||||||||||||||
Asset-backed securities
|
$ | 33,174 | $ | 10,252 | $ | (32,559 | ) | $ | (621 | ) | $ | 10,246 | ||||||||
Mortgage-backed securities
|
72,589 | 101,037 | (117,435 | ) | (1,376 | ) | 54,815 | |||||||||||||
Total
|
$ | 105,763 | $ | 111,289 | $ | (149,994 | ) | $ | (1,997 | ) | $ | 65,061 |
Final Contractual Maturity
|
||||||||||||||||||||
(Thousands of Dollars) |
Due in 1 Year
or Less
|
Due in 1 to 5
Years
|
Due in 5 to 10
Years
|
Due after 10
Years
|
Total | |||||||||||||||
Government securities
|
$ | 104,587 | $ | 7,074 | $ | 1,848 | $ | 13,615 | $ | 127,124 | ||||||||||
U.S. corporate bonds
|
- | 37,372 | 111,801 | 15,328 | 164,501 | |||||||||||||||
International corporate bonds
|
- | 8,108 | 16,657 | 1,677 | 26,442 | |||||||||||||||
Municipal bonds
|
- | - | 31,417 | 35,383 | 66,800 | |||||||||||||||
Asset-backed securities
|
- | 4,237 | 758 | - | 4,995 | |||||||||||||||
Mortgage-backed securities
|
- | - | 824 | 63,133 | 63,957 | |||||||||||||||
Debt securities
|
$ | 104,587 | $ | 56,791 | $ | 163,305 | $ | 129,136 | $ | 453,819 |
(Amounts in Thousands) (a)(b)
|
Sept. 30, 2012
|
Dec. 31, 2011
|
||||||
Megawatt hours (MWh) of electricity
|
53,401
|
37,522
|
||||||
MMBtu of natural gas
|
978
|
7,290
|
||||||
Gallons of vehicle fuel
|
402
|
330
|
(a)
|
Amounts are not reflective of net positions in the underlying commodities.
|
(b)
|
Notional amounts for options are included on a gross basis, but are weighted for the probability of exercise.
|
Three Months Ended Sept. 30
|
||||||||
(Thousands of Dollars)
|
2012
|
2011
|
||||||
Accumulated other comprehensive (loss) income related to cash flow hedges at July 1
|
$ | (16,393 | ) | $ | 5,021 | |||
After-tax net unrealized losses related to derivatives accounted for as hedges
|
(5,277 | ) | (13,112 | ) | ||||
After-tax net realized losses (gains) on derivative transactions reclassified into earnings
|
100 | (34 | ) | |||||
Accumulated other comprehensive loss related to cash flow hedges at Sept. 30
|
$ | (21,570 | ) | $ | (8,125 | ) |
Nine Months Ended Sept. 30
|
||||||||
(Thousands of Dollars)
|
2012
|
2011
|
||||||
Accumulated other comprehensive (loss) income related to cash flow hedges at Jan. 1
|
$ | (11,729 | ) | $ | 4,977 | |||
After-tax net unrealized losses related to derivatives accounted for as hedges
|
(9,874 | ) | (13,007 | ) | ||||
After-tax net realized losses (gains) on derivative transactions reclassified into earnings
|
33 | (95 | ) | |||||
Accumulated other comprehensive loss related to cash flow hedges at Sept. 30
|
$ | (21,570 | ) | $ | (8,125 | ) |
Three Months Ended Sept. 30, 2012
|
||||||||||||||||||||||
Fair Value Gains (Losses)
|
Pre-Tax (Gains) Losses Reclassified
|
|||||||||||||||||||||
Recognized During the Period in:
|
into Income During the Period from:
|
|||||||||||||||||||||
Accumulated
|
Accumulated
|
Pre-Tax Gains
|
||||||||||||||||||||
Other
|
Regulatory
|
Other
|
Regulatory
|
Recognized
|
||||||||||||||||||
Comprehensive
|
(Assets) and
|
Comprehensive
|
Assets and
|
During the Period
|
||||||||||||||||||
(Thousands of Dollars)
|
Loss
|
Liabilities
|
Loss
|
(Liabilities)
|
in Income
|
|||||||||||||||||
Derivatives designated as cash flow hedges
|
||||||||||||||||||||||
Interest rate
|
$ | (9,087 | ) | $ | - | $ | 194 | (a) | $ | - | $ | - | ||||||||||
Vehicle fuel and other commodity
|
94 | - | (22 | ) | (e) | - | - | |||||||||||||||
Total
|
$ | (8,993 | ) | $ | - | $ | 172 | $ | - | $ | - | |||||||||||
Other derivative instruments
|
||||||||||||||||||||||
Trading commodity
|
$ | - | $ | - | $ | - | $ | - | $ | 7,650 | (b) | |||||||||||
Electric commodity
|
- | 3,923 | - | (11,931 | ) | (c) | - | |||||||||||||||
Natural gas commodity
|
- | 60 | - | - | - | |||||||||||||||||
Total
|
$ | - | $ | 3,983 | $ | - | $ | (11,931 | ) | $ | 7,650 |
Nine Months Ended Sept. 30, 2012
|
||||||||||||||||||||||
Fair Value Gains (Losses)
|
Pre-Tax (Gains) Losses Reclassified
|
|||||||||||||||||||||
Recognized During the Period in:
|
into Income During the Period from:
|
|||||||||||||||||||||
Accumulated
|
Accumulated
|
Pre-Tax Gains
|
||||||||||||||||||||
Other
|
Regulatory
|
Other
|
Regulatory
|
Recognized
|
||||||||||||||||||
Comprehensive
|
(Assets) and
|
Comprehensive
|
Assets and
|
During the Period
|
||||||||||||||||||
(Thousands of Dollars)
|
Loss
|
Liabilities
|
Loss
|
(Liabilities)
|
in Income
|
|||||||||||||||||
Derivatives designated as cash flow hedges
|
||||||||||||||||||||||
Interest rate
|
$ | (16,832 | ) | $ | - | $ | 140 | (a) | $ | - | $ | - | ||||||||||
Vehicle fuel and other commodity
|
79 | - | (80 | ) | (e) | - | - | |||||||||||||||
Total
|
$ | (16,753 | ) | $ | - | $ | 60 | $ | - | $ | - | |||||||||||
Other derivative instruments
|
||||||||||||||||||||||
Trading commodity
|
$ | - | $ | - | $ | - | $ | - | $ | 10,961 | (b) | |||||||||||
Electric commodity
|
- | 43,679 | - | (29,616 | ) | (c) | - | |||||||||||||||
Natural gas commodity
|
- | (2,503 | ) | - | 16,158 | (d) | - | |||||||||||||||
Total
|
$ | - | $ | 41,176 | $ | - | $ | (13,458 | ) | $ | 10,961 |
Three Months Ended Sept. 30, 2011
|
||||||||||||||||||||||
Fair Value Gains (Losses)
|
Pre-Tax (Gains) Losses Reclassified
|
|||||||||||||||||||||
Recognized During the Period in:
|
into Income During the Period from:
|
|||||||||||||||||||||
Accumulated
|
Accumulated
|
Pre-Tax Gains
|
||||||||||||||||||||
Other
|
Regulatory
|
Other
|
Regulatory
|
Recognized
|
||||||||||||||||||
Comprehensive
|
(Assets) and
|
Comprehensive
|
Assets and
|
During the Period
|
||||||||||||||||||
(Thousands of Dollars)
|
Loss
|
Liabilities
|
Loss
|
(Liabilities)
|
in Income
|
|||||||||||||||||
Derivatives designated as cash flow hedges
|
||||||||||||||||||||||
Interest rate
|
$ | (22,032 | ) | $ | - | $ | (27 | ) | (a) | $ | - | $ | - | |||||||||
Vehicle fuel and other commodity
|
(116 | ) | - | (30 | ) | (e) | - | - | ||||||||||||||
Total
|
$ | (22,148 | ) | $ | - | $ | (57 | ) | $ | - | $ | - | ||||||||||
Other derivative instruments
|
||||||||||||||||||||||
Trading commodity
|
$ | - | $ | - | $ | - | $ | - | $ | 338 | (b) | |||||||||||
Electric commodity
|
- | 10,392 | - | (11,050 | ) | (c) | - | |||||||||||||||
Natural gas commodity
|
- | (8,106 | ) | - | - | - | ||||||||||||||||
Total
|
$ | - | $ | 2,286 | $ | - | $ | (11,050 | ) | $ | 338 |
Nine Months Ended Sept. 30, 2011
|
||||||||||||||||||||||
Fair Value Gains (Losses)
|
Pre-Tax (Gains) Losses Reclassified
|
|||||||||||||||||||||
Recognized During the Period in:
|
into Income During the Period from:
|
|||||||||||||||||||||
Accumulated
|
Accumulated
|
Pre-Tax Gains
|
||||||||||||||||||||
Other
|
Regulatory
|
Other
|
Regulatory
|
Recognized
|
||||||||||||||||||
Comprehensive
|
(Assets) and
|
Comprehensive
|
Assets and
|
During the Period
|
||||||||||||||||||
(Thousands of Dollars)
|
Loss
|
Liabilities
|
Loss
|
(Liabilities)
|
in Income
|
|||||||||||||||||
Derivatives designated as cash flow hedges
|
||||||||||||||||||||||
Interest rate
|
$ | (22,032 | ) | $ | - | $ | (81 | ) |
(a)
|
$ | - | $ | - | |||||||||
Vehicle fuel and other commodity
|
61 | - | (85 | ) |
(e)
|
- | - | |||||||||||||||
Total
|
$ | (21,971 | ) | $ | - | $ | (166 | ) | $ | - | $ | - | ||||||||||
Other derivative instruments
|
||||||||||||||||||||||
Trading commodity
|
$ | - | $ | - | $ | - | $ | - | $ | 7,013 |
(b)
|
|||||||||||
Electric commodity
|
- | 29,537 | - | (28,605 | ) |
(c)
|
- | |||||||||||||||
Natural gas commodity
|
- | (11,658 | ) | - | 10,928 |
(d)
|
- | |||||||||||||||
Total
|
$ | - | $ | 17,879 | $ | - | $ | (17,677 | ) | $ | 7,013 |
(a)
|
Amounts are recorded to interest charges.
|
(b)
|
Amounts are recorded to electric operating revenues. Portions of these gains and losses are shared with electric customers through margin-sharing mechanisms and deducted from gross revenue, as appropriate.
|
(c)
|
Amounts are recorded to electric fuel and purchased power; these derivative settlement gains and losses are shared with electric customers through fuel and purchased energy cost-recovery mechanisms, and reclassified out of income as regulatory assets or liabilities, as appropriate.
|
(d)
|
Amounts are recorded to cost of natural gas sold and transported; these derivative settlement gains and losses are shared with natural gas customers through purchased natural gas cost-recovery mechanisms, and reclassified out of income as regulatory assets or liabilities, as appropriate.
|
(e)
|
Amounts are recorded to operating and maintenance (O&M) expenses.
|
Sept. 30, 2012
|
||||||||||||||||||||||||
Fair Value
|
||||||||||||||||||||||||
Fair Value
|
Counterparty
|
|||||||||||||||||||||||
(Thousands of Dollars)
|
Level 1
|
Level 2
|
Level 3
|
Total
|
Netting (b)
|
Total
|
||||||||||||||||||
Current derivative assets
|
||||||||||||||||||||||||
Derivatives designated as cash flow hedges:
|
||||||||||||||||||||||||
Vehicle fuel and other commodity
|
$ | - | $ | 74 | $ | - | $ | 74 | $ | - | $ | 74 | ||||||||||||
Other derivative instruments:
|
||||||||||||||||||||||||
Trading commodity
|
5 | 21,360 | - | 21,365 | (4,811 | ) | 16,554 | |||||||||||||||||
Electric commodity
|
- | - | 27,583 | 27,583 | (1,801 | ) | 25,782 | |||||||||||||||||
Natural gas commodity
|
- | 156 | - | 156 | (26 | ) | 130 | |||||||||||||||||
Total current derivative assets
|
$ | 5 | $ | 21,590 | $ | 27,583 | $ | 49,178 | $ | (6,638 | ) | 42,540 | ||||||||||||
Purchased power agreements (a)
|
23,109 | |||||||||||||||||||||||
Current derivative instruments
|
$ | 65,649 | ||||||||||||||||||||||
Noncurrent derivative assets
|
||||||||||||||||||||||||
Derivatives designated as cash flow hedges:
|
||||||||||||||||||||||||
Vehicle fuel and other commodity
|
$ | - | $ | 76 | $ | - | $ | 76 | $ | (76 | ) | $ | - | |||||||||||
Other derivative instruments:
|
||||||||||||||||||||||||
Trading commodity
|
- | 38,774 | - | 38,774 | (3,198 | ) | 35,576 | |||||||||||||||||
Total noncurrent derivative assets
|
$ | - | $ | 38,850 | $ | - | $ | 38,850 | $ | (3,274 | ) | 35,576 | ||||||||||||
Purchased power agreements (a)
|
37,284 | |||||||||||||||||||||||
Noncurrent derivative instruments
|
$ | 72,860 | ||||||||||||||||||||||
Current derivative liabilities
|
||||||||||||||||||||||||
Derivatives designated as cash flow hedges:
|
||||||||||||||||||||||||
Other derivative instruments:
|
||||||||||||||||||||||||
Trading commodity
|
$ | 109 | $ | 15,258 | $ | - | $ | 15,367 | $ | (8,100 | ) | $ | 7,267 | |||||||||||
Electric commodity
|
- | - | 1,801 | 1,801 | (1,801 | ) | - | |||||||||||||||||
Total current derivative liabilities
|
$ | 109 | $ | 15,258 | $ | 1,801 | $ | 17,168 | $ | (9,901 | ) | 7,267 | ||||||||||||
Purchased power agreements (a)
|
13,851 | |||||||||||||||||||||||
Current derivative instruments
|
$ | 21,118 | ||||||||||||||||||||||
Noncurrent derivative liabilities
|
||||||||||||||||||||||||
Other derivative instruments:
|
||||||||||||||||||||||||
Trading commodity
|
$ | - | $ | 17,830 | $ | - | $ | 17,830 | $ | (3,274 | ) | $ | 14,556 | |||||||||||
Total noncurrent derivative liabilities
|
$ | - | $ | 17,830 | $ | - | $ | 17,830 | $ | (3,274 | ) | 14,556 | ||||||||||||
Purchased power agreements (a)
|
162,631 | |||||||||||||||||||||||
Noncurrent derivative instruments
|
$ | 177,187 |
(a) | In 2003, as a result of implementing new guidance on the normal purchase exception for derivative accounting, NSP-Minnesota began recording several long-term purchased power agreements at fair value due to accounting requirements related to underlying price adjustments. As these purchases are recovered through normal regulatory recovery mechanisms in the respective jurisdictions, the changes in fair value for these contracts were offset by regulatory assets and liabilities. During 2006, NSP-Minnesota qualified these contracts under the normal purchase exception. Based on this qualification, the contracts are no longer adjusted to fair value and the previous carrying value of these contracts will be amortized over the remaining contract lives along with the offsetting regulatory assets and liabilities. |
(b) | The accounting guidance for derivatives and hedging permits the netting of receivables and payables for derivatives and related collateral amounts when a legally enforceable master netting agreement exists between NSP-Minnesota and a counterparty. A master netting agreement is an agreement between two parties who have multiple contracts with each other that provides for the net settlement of all contracts in the event of default on or termination of any one contract. |
Dec. 31, 2011
|
||||||||||||||||||||||||
Fair Value
|
||||||||||||||||||||||||
Fair Value
|
Counterparty
|
|||||||||||||||||||||||
(Thousands of Dollars)
|
Level 1
|
Level 2
|
Level 3
|
Total
|
Netting (b)
|
Total
|
||||||||||||||||||
Current derivative assets
|
||||||||||||||||||||||||
Derivatives designated as cash flow hedges:
|
||||||||||||||||||||||||
Vehicle fuel and other commodity
|
$ | - | $ | 93 | $ | - | $ | 93 | $ | - | $ | 93 | ||||||||||||
Other derivative instruments:
|
||||||||||||||||||||||||
Trading commodity
|
- | 26,133 | - | 26,133 | (9,679 | ) | 16,454 | |||||||||||||||||
Electric commodity
|
- | - | 13,333 | 13,333 | (1,471 | ) | 11,862 | |||||||||||||||||
Total current derivative assets
|
$ | - | $ | 26,226 | $ | 13,333 | $ | 39,559 | $ | (11,150 | ) | 28,409 | ||||||||||||
Purchased power agreements (a)
|
23,108 | |||||||||||||||||||||||
Current derivative instruments
|
$ | 51,517 | ||||||||||||||||||||||
Noncurrent derivative assets
|
||||||||||||||||||||||||
Derivatives designated as cash flow hedges:
|
||||||||||||||||||||||||
Vehicle fuel and other commodity
|
$ | - | $ | 59 | $ | - | $ | 59 | $ | (59 | ) | $ | - | |||||||||||
Other derivative instruments:
|
||||||||||||||||||||||||
Trading commodity
|
- | 28,307 | - | 28,307 | (2,234 | ) | 26,073 | |||||||||||||||||
Total noncurrent derivative assets
|
$ | - | $ | 28,366 | $ | - | $ | 28,366 | $ | (2,293 | ) | 26,073 | ||||||||||||
Purchased power agreements (a)
|
54,616 | |||||||||||||||||||||||
Noncurrent derivative instruments
|
$ | 80,689 | ||||||||||||||||||||||
Current derivative liabilities
|
||||||||||||||||||||||||
Derivatives designated as cash flow hedges:
|
||||||||||||||||||||||||
Interest rate
|
$ | - | $ | 28,119 | $ | - | $ | 28,119 | $ | - | $ | 28,119 | ||||||||||||
Other derivative instruments:
|
||||||||||||||||||||||||
Trading commodity
|
- | 21,816 | - | 21,816 | (11,647 | ) | 10,169 | |||||||||||||||||
Electric commodity
|
- | 698 | 916 | 1,614 | (1,471 | ) | 143 | |||||||||||||||||
Natural gas commodity
|
- | 13,499 | - | 13,499 | - | 13,499 | ||||||||||||||||||
Total current derivative liabilities
|
$ | - | $ | 64,132 | $ | 916 | $ | 65,048 | $ | (13,118 | ) | 51,930 | ||||||||||||
Purchased power agreements (a)
|
13,851 | |||||||||||||||||||||||
Current derivative instruments
|
$ | 65,781 | ||||||||||||||||||||||
Noncurrent derivative liabilities
|
||||||||||||||||||||||||
Other derivative instruments:
|
||||||||||||||||||||||||
Trading commodity
|
$ | - | $ | 13,464 | $ | - | $ | 13,464 | $ | (2,293 | ) | $ | 11,171 | |||||||||||
Total noncurrent derivative liabilities
|
$ | - | $ | 13,464 | $ | - | $ | 13,464 | $ | (2,293 | ) | 11,171 | ||||||||||||
Purchased power agreements (a)
|
173,019 | |||||||||||||||||||||||
Noncurrent derivative instruments
|
$ | 184,190 |
(a)
|
In 2003, as a result of implementing new guidance on the normal purchase exception for derivative accounting, NSP-Minnesota began recording several long-term purchased power agreements at fair value due to accounting requirements related to underlying price adjustments. As these purchases are recovered through normal regulatory recovery mechanisms in the respective jurisdictions, the changes in fair value for these contracts were offset by regulatory assets and liabilities. During 2006, NSP-Minnesota qualified these contracts under the normal purchase exception. Based on this qualification, the contracts are no longer adjusted to fair value and the previous carrying value of these contracts will be amortized over the remaining contract lives along with the offsetting regulatory assets and liabilities.
|
(b)
|
The accounting guidance for derivatives and hedging permits the netting of receivables and payables for derivatives and related collateral amounts when a legally enforceable master netting agreement exists between NSP-Minnesota and a counterparty. A master netting agreement is an agreement between two parties who have multiple contracts with each other that provides for the net settlement of all contracts in the event of default on or termination of any one contract.
|
Three Months Ended Sept. 30
|
||||||||
(Thousands of Dollars)
|
2012
|
2011
|
||||||
Balance at July 1
|
$ | 33,789 | $ | 3,996 | ||||
Settlements
|
(12,649 | ) | (9,707 | ) | ||||
Net transactions recorded during the period:
|
||||||||
Gains (losses) recognized in earnings (a)
|
13 | (7 | ) | |||||
Gains recorded as regulatory liabilities
|
4,629 | 9,037 | ||||||
Balance at Sept. 30
|
$ | 25,782 | $ | 3,319 |
Nine Months Ended Sept. 30
|
||||||||
(Thousands of Dollars)
|
2012
|
2011
|
||||||
Balance at Jan. 1
|
$ | 12,417 | $ | 2,392 | ||||
Purchases
|
37,296 | 33,609 | ||||||
Settlements
|
(34,209 | ) | (25,708 | ) | ||||
Net transactions recorded during the period:
|
||||||||
Gains recognized in earnings (a)
|
5 | 64 | ||||||
Gains (losses) recorded as regulatory assets and liabilities
|
10,273 | (7,038 | ) | |||||
Balance at Sept. 30
|
$ | 25,782 | $ | 3,319 |
(a)
|
These amounts relate to commodity derivatives held at the end of the period.
|
Sept. 30, 2012
|
Dec. 31, 2011
|
|||||||||||||||
Carrying
|
Carrying
|
|||||||||||||||
(Thousands of Dollars)
|
Amount
|
Fair Value
|
Amount
|
Fair Value
|
||||||||||||
Long-term debt, including current portion
|
$ | 3,488,461 | $ | 4,240,055 | $ | 3,338,897 | $ | 4,066,367 |
9.
|
Other (Expense) Income, Net
|
Three Months Ended Sept. 30
|
Nine Months Ended Sept. 30
|
|||||||||||||||
2012
|
2011
|
2012
|
2011
|
|||||||||||||
Interest income
|
$ | 837 | $ | 691 | $ | 4,593 | $ | 3,644 | ||||||||
Other nonoperating income
|
141 | 91 | 613 | 423 | ||||||||||||
Insurance policy expense
|
(1,306 | ) | (680 | ) | (4,011 | ) | (2,286 | ) | ||||||||
Other (expense) income, net
|
$ | (328 | ) | $ | 102 | $ | 1,195 | $ | 1,781 |
10.
|
Segment Information
|
·
|
NSP-Minnesota's regulated electric utility segment generates electricity which is transmitted and distributed in Minnesota, North Dakota and South Dakota. In addition, this segment includes sales for resale and provides wholesale transmission service to various entities in the United States. Regulated electric utility also includes NSP-Minnesota's commodity trading operations.
|
·
|
NSP-Minnesota's regulated natural gas utility segment transports, stores and distributes natural gas in portions of Minnesota and North Dakota.
|
·
|
Revenues from operating segments not included above are below the necessary quantitative thresholds and are therefore included in the all other category. Those primarily include appliance repair services, nonutility real estate activities and revenues associated with processing solid waste into refuse-derived fuel.
|
Regulated
|
Regulated
|
All
|
Reconciling
|
Consolidated
|
||||||||||||||||
(Thousands of Dollars)
|
Electric
|
Natural Gas
|
Other
|
Eliminations
|
Total
|
|||||||||||||||
Three Months Ended Sept. 30, 2012
|
||||||||||||||||||||
Operating revenues from external customers
|
$ | 1,130,207 | $ | 49,522 | $ | 5,671 | $ | - | $ | 1,185,400 | ||||||||||
Intersegment revenues
|
143 | 160 | - | (303 | ) | - | ||||||||||||||
Total revenues
|
$ | 1,130,350 | $ | 49,682 | $ | 5,671 | $ | (303 | ) | $ | 1,185,400 | |||||||||
Net income (loss)
|
$ | 138,453 | $ | (5,081 | ) | $ | 2,639 | $ | - | $ | 136,011 |
Regulated
|
Regulated
|
All
|
Reconciling
|
Consolidated
|
||||||||||||||||
(Thousands of Dollars)
|
Electric
|
Natural Gas
|
Other
|
Eliminations
|
Total
|
|||||||||||||||
Three Months Ended Sept. 30, 2011
|
||||||||||||||||||||
Operating revenues from external customers
|
$ | 1,103,875 | $ | 58,914 | $ | 5,349 | $ | - | $ | 1,168,138 | ||||||||||
Intersegment revenues
|
157 | 100 | - | (257 | ) | - | ||||||||||||||
Total revenues
|
$ | 1,104,032 | $ | 59,014 | $ | 5,349 | $ | (257 | ) | $ | 1,168,138 | |||||||||
Net income (loss)
|
$ | 140,383 | $ | (4,967 | ) | $ | 6,486 | $ | - | $ | 141,902 |
Regulated
|
Regulated
|
All
|
Reconciling
|
Consolidated
|
||||||||||||||||
(Thousands of Dollars)
|
Electric
|
Natural Gas
|
Other
|
Eliminations
|
Total
|
|||||||||||||||
Nine Months Ended Sept. 30, 2012
|
||||||||||||||||||||
Operating revenues from external customers
|
$ | 2,912,641 | $ | 305,105 | $ | 16,963 | $ | - | $ | 3,234,709 | ||||||||||
Intersegment revenues
|
410 | 540 | - | (950 | ) | - | ||||||||||||||
Total revenues
|
$ | 2,913,051 | $ | 305,645 | $ | 16,963 | $ | (950 | ) | $ | 3,234,709 | |||||||||
Net income
|
$ | 262,655 | $ | 6,405 | $ | 8,249 | $ | - | $ | 277,309 |
Regulated
|
Regulated
|
All
|
Reconciling
|
Consolidated
|
||||||||||||||||
(Thousands of Dollars)
|
Electric
|
Natural Gas
|
Other
|
Eliminations
|
Total
|
|||||||||||||||
Nine Months Ended Sept. 30, 2011
|
||||||||||||||||||||
Operating revenues from external customers
|
$ | 2,916,082 | $ | 439,562 | $ | 15,912 | $ | - | $ | 3,371,556 | ||||||||||
Intersegment revenues
|
453 | 439 | - | (892 | ) | - | ||||||||||||||
Total revenues
|
$ | 2,916,535 | $ | 440,001 | $ | 15,912 | $ | (892 | ) | $ | 3,371,556 | |||||||||
Net income
|
$ | 270,557 | $ | 16,182 | $ | 12,561 | $ | - | $ | 299,300 |
11.
|
Benefit Plans and Other Postretirement Benefits
|
Three Months Ended Sept. 30
|
||||||||||||||||
2012
|
2011
|
2012
|
2011
|
|||||||||||||
Postretirement Health
|
||||||||||||||||
(Thousands of Dollars)
|
Pension Benefits
|
Care Benefits
|
||||||||||||||
Service cost
|
$ | 7,352 | $ | 7,004 | $ | 24 | $ | 21 | ||||||||
Interest cost
|
12,304 | 12,987 | 1,782 | 1,843 | ||||||||||||
Expected return on plan assets
|
(16,828 | ) | (18,560 | ) | (110 | ) | (144 | ) | ||||||||
Amortization of transition obligation
|
- | - | 337 | 337 | ||||||||||||
Amortization of prior service cost (credit)
|
2,954 | 3,292 | (29 | ) | (29 | ) | ||||||||||
Amortization of net loss
|
10,032 | 7,184 | 801 | 587 | ||||||||||||
Net periodic benefit cost
|
15,814 | 11,907 | 2,805 | 2,615 | ||||||||||||
Cost not recognized due to the effects of regulation
|
(8,570 | ) | (8,724 | ) | - | - | ||||||||||
Net benefit cost recognized for financial reporting
|
$ | 7,244 | $ | 3,183 | $ | 2,805 | $ | 2,615 |
Nine Months Ended Sept. 30
|
||||||||||||||||
2012
|
2011
|
2012
|
2011
|
|||||||||||||
Postretirement Health
|
||||||||||||||||
(Thousands of Dollars)
|
Pension Benefits
|
Care Benefits
|
||||||||||||||
Service cost
|
$ | 22,058 | $ | 21,012 | $ | 72 | $ | 65 | ||||||||
Interest cost
|
36,914 | 38,960 | 5,347 | 5,529 | ||||||||||||
Expected return on plan assets
|
(50,486 | ) | (55,681 | ) | (329 | ) | (432 | ) | ||||||||
Amortization of transition obligation
|
- | - | 1,010 | 1,010 | ||||||||||||
Amortization of prior service cost (credit)
|
8,864 | 9,877 | (88 | ) | (88 | ) | ||||||||||
Amortization of net loss
|
30,097 | 21,552 | 2,403 | 1,761 | ||||||||||||
Net periodic benefit cost
|
47,447 | 35,720 | 8,415 | 7,845 | ||||||||||||
Cost not recognized due to the effects of regulation
|
(25,711 | ) | (26,174 | ) | - | - | ||||||||||
Net benefit cost recognized for financial reporting
|
$ | 21,736 | $ | 9,546 | $ | 8,415 | $ | 7,845 |
Nine Months Ended Sept. 30
|
||||||||
(Millions of Dollars)
|
2012
|
2011
|
||||||
Electric revenues
|
$ | 2,913 | $ | 2,916 | ||||
Electric fuel and purchased power
|
(1,176 | ) | (1,181 | ) | ||||
Electric margin
|
$ | 1,737 | $ | 1,735 |
2012 vs. 2011
|
||||
Estimated impact of weather
|
$ | (12 | ) | |
Conservation revenue (offset by expenses)
|
(11 | ) | ||
Differences in Minnesota retail rates (2011 interim compared to 2012 settlement) (a)
|
(9 | ) | ||
Retail sales decrease (excluding weather impact)
|
(7 | ) | ||
Fuel and purchased power cost recovery
|
(5 | ) | ||
Transmission revenue
|
19 | |||
Retail rate increases (North Dakota and South Dakota)
|
8 | |||
Conservation incentive
|
7 | |||
Interchange agreement billing with NSP-Wisconsin
|
6 | |||
Other, net
|
1 | |||
Total decrease in electric revenues
|
$ | (3 | ) |
(a)
|
NSP-Minnesota reduced depreciation expense and revenues by approximately $24 million in the first nine months of 2012 to reflect the settlements in the 2011 Minnesota and South Dakota electric rate cases.
|
(Millions of Dollars)
|
2012 vs. 2011
|
|||
Transmission revenue, net of costs
|
$ | 11 | ||
Retail rate increases (North Dakota and South Dakota)
|
8 | |||
Conservation incentive
|
7 | |||
Interchange agreement billing with NSP-Wisconsin
|
7 | |||
Trading
|
5 | |||
Estimated impact of weather
|
(12 | ) | ||
Conservation revenue (offset by expenses)
|
(11 | ) | ||
Differences in Minnesota retail rates (2011 interim compared to 2012 settlement) (a)
|
(9 | ) | ||
Retail sales decrease (excluding weather impact)
|
(7 | ) | ||
Other, net
|
3 | |||
Total increase in electric margin
|
$ | 2 |
(a)
|
NSP-Minnesota reduced depreciation expense and revenues by approximately $24 million in the first nine months of 2012 to reflect the settlements in the 2011 Minnesota and South Dakota electric rate cases.
|
Nine Months Ended Sept. 30
|
||||||||
(Millions of Dollars)
|
2012
|
2011
|
||||||
Natural gas revenues
|
$ | 305 | $ | 440 | ||||
Cost of natural gas sold and transported
|
(179 | ) | (287 | ) | ||||
Natural gas margin
|
$ | 126 | $ | 153 |
(Millions of Dollars)
|
2012 vs. 2011
|
|||
Purchased natural gas adjustment clause recovery
|
$ | (107 | ) | |
Estimated impact of weather
|
(15 | ) | ||
Conservation revenue (offset by expenses)
|
(13 | ) | ||
Total decrease in natural gas revenues
|
$ | (135 | ) |
2012 vs. 2011
|
||||
Estimated impact of weather
|
$ | (15 | ) | |
Conservation revenue (offset by expenses)
|
(13 | ) | ||
Other, net
|
1 | |||
Total decrease in natural gas margin
|
$ | (27 | ) |
2012 vs. 2011
|
||||
Higher employee benefit costs
|
$ | 18 | ||
Higher plant generation costs
|
5 | |||
Higher consulting costs
|
2 | |||
Interchange agreement billing with NSP-Wisconsin
|
2 | |||
Lower bad debt costs
|
(4 | ) | ||
Lower lease costs
|
(2 | ) | ||
Other, net
|
(1 | ) | ||
Total increase in O&M expenses
|
$ | 20 |
·
|
Higher employee benefit costs are primarily due to higher pension expense.
|
·
|
Higher plant generation costs are related to increased internal and external labor costs for outages and overhauls in 2012.
|
*
|
Indicates incorporation by reference
|
†
|
Furnished, herewith, not filed. Pursuant to Rule 406T of Regulation S-T, the Interactive Data Files on Exhibit 101 hereto are deemed not filed or part of a registration statement or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, are deemed not filed for purposes of Section 18 of the Securities and Exchange Act of 1934, as amended, and otherwise are not subject to liability under those sections.
|
3.01*
|
Articles of Incorporation and Amendments of Northern Power Corp. (renamed Northern States Power Co. (a Minnesota corporation) on Aug. 21, 2000) (Exhibit 3.01 to Form 10-12G (file no. 000-31709) dated Oct. 5, 2000).
|
|
3.02*
|
By-Laws of Northern Power Corp. as Amended on Aug. 1, 2000 and June 3, 2008 (Exhibit 3.02 to Form 8-K (file no. 001-31387) dated June 3, 2008).
|
|
4.01*
|
Supplemental Indenture dated as of Aug. 1, 2012 between NSP-Minnesota and The Bank of New York Mellon Trust Company, NA, as successor Trustee, creating $300 million principal amount of 2.15 percent First Mortgage Bonds, Series due Aug. 15, 2022 and $500 million principal amount of 3.40 percent First Mortgage Bonds, Series due Aug. 15, 2042 (Exhibit 4.01 to Form 8-K dated Aug. 13, 2012 (file no. 001-31387)).
|
|
10.01*
|
Amended and Restated Credit Agreement, dated as of July 27, 2012 among NSP-Minnesota, as Borrower, the several lenders from time to time parties thereto, JPMorgan Chase Bank, N.A., as Administrative Agent, Bank of America, N.A., and Barclays Bank Plc, as Syndication Agents, and Wells Fargo Bank, National Association, as Documentation Agent (Incorporated by reference to Exhibit 99.02 to Xcel Energy Inc.'s Form 8-K, dated July 27, 2012 (file no. 001-03034)).
|
|
Principal Executive Officer's certifications pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
||
Principal Financial Officer's certifications pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
||
Certification pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
||
Statement pursuant to Private Securities Litigation Reform Act of 1995.
|
||
101 †
|
The following materials from NSP-Minnesota's Quarterly Report on Form 10-Q for the quarter ended Sept. 30, 2012 are formatted in XBRL (eXtensible Business Reporting Language): (i) the Consolidated Statements of Income, (ii) the Consolidated Statements of Comprehensive Income (iii) the Consolidated Statements of Cash Flows, (iv) the Consolidated Balance Sheets, (v) Notes to Condensed Consolidated Financial Statements, and (vi) document and entity information.
|
Oct. 26, 2012 |
Northern States Power Company (a Minnesota corporation)
|
|
By:
|
/s/ JEFFREY S. SAVAGE
|
|
Jeffrey S. Savage
|
||
Vice President and Controller
|
||
/s/ TERESA S. MADDEN
|
||
Teresa S. Madden
|
||
Senior Vice President, Chief Financial Officer and Director
|
1.
|
I have reviewed this report on Form 10-Q of Northern States Power Company (a Minnesota corporation);
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
|
/s/ JUDY M. POFERL
|
|
Judy M. Poferl
|
|
President, Chief Executive Officer and Director
|
1.
|
I have reviewed this report on Form 10-Q of Northern States Power Company (a Minnesota corporation);
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c)
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
d)
|
Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting.
|
|
/s/ TERESA S. MADDEN
|
|
Teresa S. Madden
|
|
Senior Vice President, Chief Financial Officer and Director
|
(1)
|
The Form 10-Q fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(2)
|
The information contained in the Form 10-Q fairly presents, in all material respects, the financial condition and results of operations of NSP‑Minnesota as of the dates and for the periods expressed in the Form 10-Q.
|
|
/s/ JUDY M. POFERL
|
|
Judy M. Poferl
|
|
President, Chief Executive Officer and Director
|
|
|
|
/s/ TERESA S. MADDEN
|
|
Teresa S. Madden
|
|
Senior Vice President, Chief Financial Officer and Director
|
· | Economic conditions, including inflation rates, monetary fluctuations and their impact on capital expenditures; |
· | The risk of a significant slowdown in growth or decline in the U.S. economy, the risk of delay in growth recovery in the U.S. economy or the risk of increased cost for insurance premiums, security and other items as a consequence of past or future terrorist attacks; |
· | Trade, monetary, fiscal, taxation and environmental policies of governments, agencies and similar organizations in geographic areas where NSP‑Minnesota has a financial interest; |
· | Customer business conditions, including demand for their products or services and supply of labor and materials used in creating their products and services; |
· | Financial or regulatory accounting principles or policies imposed by the FASB, the SEC, the FERC and similar entities with regulatory oversight; |
· | Availability or cost of capital such as changes in: interest rates; market perceptions of the utility industry, NSP‑Minnesota, Xcel Energy Inc. or any of its other subsidiaries; or security ratings; |
· | Factors affecting utility and nonutility operations such as unusual weather conditions; catastrophic weather-related damage; unscheduled generation outages, maintenance or repairs; unanticipated changes to fossil fuel, nuclear fuel or natural gas supply costs or availability due to higher demand, shortages, transportation problems or other developments; nuclear or environmental incidents; cyber incidents; or electric transmission or natural gas pipeline constraints; |
· | Employee workforce factors, including loss or retirement of key executives, collective bargaining agreements with union employees, or work stoppages; |
· | Increased competition in the utility industry or additional competition in the markets served by NSP‑Minnesota, Xcel Energy Inc. and its other subsidiaries; |
· | State, federal and foreign legislative and regulatory initiatives that affect cost and investment recovery, have an impact on rate structures and affect the speed and degree to which competition enters the electric and natural gas markets; industry restructuring initiatives; transmission system operation and/or administration initiatives; recovery of investments made under traditional regulation; nature of competitors entering the industry; retail wheeling; a new pricing structure; and former customers entering the generation market; |
· | Environmental laws and regulations, including legislation and regulations relating to climate change, and the associated cost of compliance; |
· | Rate-setting policies or procedures of regulatory entities, including environmental externalities, which are values established by regulators assigning environmental costs to each method of electricity generation when evaluating generation resource options; |
· | Nuclear regulatory policies and procedures, including operating regulations and spent nuclear fuel storage; |
· | Social attitudes regarding the utility and power industries; |
· | Cost and other effects of legal and administrative proceedings, settlements, investigations and claims; |
· | Technological developments that result in competitive disadvantages and create the potential for impairment of existing assets; |
· | Risks associated with implementations of new technologies; and |
· | Other business or investment considerations that may be disclosed from time to time in SEC filings, including "Risk Factors" in Item 1A of NSP‑Minnesota's form 10-K for the year ended Dec. 31, 2011, or in other publicly disseminated written documents. |
Commitments and Contingencies, Legal Contingencies (Details) (USD $)
|
1 Months Ended | |||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2012
Native Village of Kivalina vs. Xcel Energy Inc. et al. [Member]
|
Feb. 29, 2008
Native Village of Kivalina vs. Xcel Energy Inc. et al. [Member]
|
Sep. 30, 2012
Comer vs. Xcel Energy Inc. et al. [Member]
|
May 31, 2011
Comer vs. Xcel Energy Inc. et al. [Member]
|
Sep. 30, 2012
Merricourt Wind Project Litigation [Member]
|
May 31, 2011
Merricourt Wind Project Litigation [Member]
|
Apr. 30, 2011
Merricourt Wind Project Litigation [Member]
MW
|
Mar. 31, 2011
Merricourt Wind Project Litigation [Member]
|
Mar. 31, 2012
Nuclear Waste Disposal Litigation [Member]
|
Aug. 31, 2011
Nuclear Waste Disposal Litigation [Member]
|
Sep. 30, 2007
Nuclear Waste Disposal Litigation [Member]
|
Sep. 30, 2012
Nuclear Waste Disposal Litigation [Member]
|
|
Legal Contingencies [Abstract] | ||||||||||||
Number of other entities against which the native village of Kivalina has filed a lawsuit | 23 | |||||||||||
Estimated cost of relocating the village of Kivalina, low end of range | $ 95,000,000 | |||||||||||
Estimated cost of relocating the village of Kivalina, high end of range | 400,000,000 | |||||||||||
Accrual for legal contingency | 0 | 0 | 0 | |||||||||
Minimum number of utility, oil, chemical and coal companies against which a lawsuit was filed in U.S. District Court in Mississippi | 85 | |||||||||||
Generating capacity (in MW) | 150 | |||||||||||
Merricourt deposit | 101,000,000 | |||||||||||
Minimum amount of damages claimed by plaintiff | 240,000,000 | |||||||||||
Damages awarded | 116,500,000 | |||||||||||
Cash payment received under settlement agreement | 18,600,000 | 100,000,000 | ||||||||||
Storage costs for spent nuclear fuel | 100,000,000 | |||||||||||
Receivable under settlement agreement | $ 20,700,000 |
Other (Expense) Income, Net (Tables)
|
9 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Sep. 30, 2012
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other (Expense) Income, Net [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Other (Expense) Income, Net | Other (expense) income, net consisted of the following:
|
Segment Information (Details) (USD $)
In Thousands, unless otherwise specified |
3 Months Ended | 9 Months Ended | ||
---|---|---|---|---|
Sep. 30, 2012
|
Sep. 30, 2011
|
Sep. 30, 2012
|
Sep. 30, 2011
|
|
Segment Reporting Information [Line Items] | ||||
Operating revenues from external customers | $ 1,185,400 | $ 1,168,138 | $ 3,234,709 | $ 3,371,556 |
Intersegment revenues | 0 | 0 | 0 | 0 |
Total operating revenues | 1,185,400 | 1,168,138 | 3,234,709 | 3,371,556 |
Net income (loss) | 136,011 | 141,902 | 277,309 | 299,300 |
Regulated Electric [Member]
|
||||
Segment Reporting Information [Line Items] | ||||
Operating revenues from external customers | 1,130,207 | 1,103,875 | 2,912,641 | 2,916,082 |
Intersegment revenues | 143 | 157 | 410 | 453 |
Total operating revenues | 1,130,350 | 1,104,032 | 2,913,051 | 2,916,535 |
Net income (loss) | 138,453 | 140,383 | 262,655 | 270,557 |
Regulated Natural Gas [Member]
|
||||
Segment Reporting Information [Line Items] | ||||
Operating revenues from external customers | 49,522 | 58,914 | 305,105 | 439,562 |
Intersegment revenues | 160 | 100 | 540 | 439 |
Total operating revenues | 49,682 | 59,014 | 305,645 | 440,001 |
Net income (loss) | (5,081) | (4,967) | 6,405 | 16,182 |
All Other [Member]
|
||||
Segment Reporting Information [Line Items] | ||||
Operating revenues from external customers | 5,671 | 5,349 | 16,963 | 15,912 |
Intersegment revenues | 0 | 0 | 0 | 0 |
Total operating revenues | 5,671 | 5,349 | 16,963 | 15,912 |
Net income (loss) | 2,639 | 6,486 | 8,249 | 12,561 |
Reconciling Eliminations [Member]
|
||||
Segment Reporting Information [Line Items] | ||||
Operating revenues from external customers | 0 | 0 | 0 | 0 |
Intersegment revenues | (303) | (257) | (950) | (892) |
Total operating revenues | (303) | (257) | (950) | (892) |
Net income (loss) | $ 0 | $ 0 | $ 0 | $ 0 |
Management's Opinion
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9 Months Ended |
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Sep. 30, 2012
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Management's Opinion [Abstract] | |
Management's Opinion | In the opinion of management, the accompanying unaudited consolidated financial statements contain all adjustments necessary to present fairly, in accordance with accounting principles generally accepted in the United States of America (GAAP), the financial position of NSP-Minnesota and its subsidiaries as of Sept. 30, 2012 and Dec. 31, 2011; the results of its operations, including the components of net income and comprehensive income, for the three and nine months ended Sept. 30, 2012 and 2011; and its cash flows for the nine months ended Sept. 30, 2012 and 2011. All adjustments are of a normal, recurring nature, except as otherwise disclosed. Management has also evaluated the impact of events occurring after Sept. 30, 2012 up to the date of issuance of these consolidated financial statements. These statements contain all necessary adjustments and disclosures resulting from that evaluation. The Dec. 31, 2011 balance sheet information has been derived from the audited 2011 consolidated financial statements included in the NSP-Minnesota Annual Report on Form 10-K for the year ended Dec. 31, 2011. These notes to the consolidated financial statements have been prepared pursuant to the rules and regulations of the SEC for Quarterly Reports on Form 10-Q. Certain information and note disclosures normally included in financial statements prepared in accordance with GAAP on an annual basis have been condensed or omitted pursuant to such rules and regulations. For further information, refer to the consolidated financial statements and notes thereto, included in the NSP-Minnesota Annual Report on Form 10-K for the year ended Dec. 31, 2011, filed with the SEC on Feb. 27, 2012. Due to the seasonality of NSP-Minnesota's electric and natural gas sales, interim results are not necessarily an appropriate base from which to project annual results. |