Segments and Related Information

12 Months Ended

Dec. 31, 2013

Segment Reporting [Abstract]

Segment Information

Segments and Related Information

Operating results from the regulated electric utility and regulated natural gas utility are each separately and regularly reviewed by PSCo’s chief operating decision maker.  PSCo evaluates performance based on profit or loss generated from the product or service provided. These segments are managed separately because the revenue streams are dependent upon regulated rate recovery, which is separately determined for each segment.

PSCo has the following reportable segments: regulated electric utility, regulated natural gas utility and all other.

• PSCo’s regulated electric utility segment generates electricity which is transmitted and distributed in Colorado. 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 PSCo’s commodity trading operations.

• PSCo’s regulated natural gas utility segment transports, stores and distributes natural gas in portions of Colorado.

• 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 steam revenue, appliance repair services and nonutility real estate activities.

Asset and capital expenditure information is not provided for PSCo’s reportable segments because as an integrated electric and natural gas utility, PSCo operates significant assets that are not dedicated to a specific business segment, and reporting assets and capital expenditures by business segment would require arbitrary and potentially misleading allocations which may not necessarily reflect the assets that would be required for the operation of the business segments on a stand-alone basis.

To report income from operations for regulated electric and regulated natural gas utility segments, the majority of costs are directly assigned to each segment. However, some costs, such as common depreciation, common O&M expenses and interest expense are allocated based on cost causation allocators. A general allocator is used for certain general and administrative expenses, including office supplies, rent, property insurance and general advertising.

The accounting policies of the segments are the same as those described in Note 1.

(Thousands of Dollars)	Regulated Electric		Regulated Natural Gas		All Other			Reconciling Eliminations			Consolidated Total
2013
Operating revenues (a)	$	3,081,171	$	1,080,703	$	40,754		$	—		$	4,202,628
Intersegment revenues	302		110		—			(412		)	—
Total revenues	$	3,081,473	$	1,080,813	$	40,754		$	(412	)	$	4,202,628
Depreciation and amortization	$	280,972	$	75,510	$	3,935		$	—		$	360,417
Interest charges and financing costs	129,787		30,604		554			—			160,945
Income tax expense (benefit)	220,356		42,294		(11,910		)	—			250,740
Net Income	368,586		69,682		15,115			—			453,383

(Thousands of Dollars)	Regulated Electric		Regulated Natural Gas		All Other			Reconciling Eliminations			Consolidated Total
2012
Operating revenues (a)	$	2,969,899	$	962,435	$	36,959		$	—		$	3,969,293
Intersegment revenues	282		90		—			(372		)	—
Total revenues	$	2,970,181	$	962,525	$	36,959		$	(372	)	$	3,969,293
Depreciation and amortization	$	267,944	$	66,983	$	3,900		$	—		$	338,827
Interest charges and financing costs	145,641		33,430		618			—			179,689
Income tax expense (benefit)	212,347		27,968		(7,771		)	—			232,544
Net income	387,724		60,003		10,349			—			458,076

(Thousands of Dollars)	Regulated Electric		Regulated Natural Gas		All Other			Reconciling Eliminations			Consolidated Total
2011
Operating revenues (a)	$	3,114,370	$	1,087,749	$	38,683		$	—		$	4,240,802
Intersegment revenues	318		242		—			(560		)	—
Total revenues	$	3,114,688	$	1,087,991	$	38,683		$	(560	)	$	4,240,802
Depreciation and amortization	$	265,078	$	59,189	$	4,315		$	—		$	328,582
Interest charges and financing costs	149,291		33,249		939			—			183,479
Income tax expense (benefit)	202,355		30,957		(4,951		)	—			228,361
Net income	334,516		55,446		6,841			—			396,803

^(a)  Operating revenues include $12.6 million, $13.7 million and $15.3 million of intercompany revenue for the years ended Dec. 31, 2013, 2012 and 2011, respectively. See Note 16 for further discussion of related party transactions by reportable segment.