Borrowings and Other Financing Instruments

6 Months Ended

Jun. 30, 2012

Borrowings and Other Financing Instruments [Abstract]

Borrowings and Other Financing Instruments

7.      Borrowings and Other Financing Instruments

 

Commercial Paper - PSCo meets its short-term liquidity requirements primarily through the issuance of commercial paper and borrowings under its credit facility.  

The following table presents commercial paper outstanding for PSCo:

(Amounts in Millions, Except Interest Rates)	Three Months Ended June 30, 2012			Twelve Months Ended Dec. 31, 2011
Borrowing limit	$	700		$	700
Amount outstanding at period end		5			-
Average amount outstanding		3			73
Maximum amount outstanding		31			304
Weighted average interest rate, computed on a daily basis		0.31	%		0.37	%
Weighted average interest rate at period end		0.30			N/A

Credit Facility - In order to use its commercial paper program to fulfill short-term funding needs, PSCo must have a revolving credit facility in place at least equal to the amount of its commercial paper borrowing limit and cannot issue commercial paper in an aggregate amount exceeding available capacity under the credit agreement.  The credit facility provides short-term financing in the form of notes payable to banks, letters of credit and back-up support for commercial paper borrowings.

 

At June 30, 2012, PSCo had the following committed credit facility available (in millions of dollars):

Credit Facility		Drawn (a)		Available
$	700.0	$	8.0	$	692.0

(a) Includes outstanding commercial paper and letters of credit.

All credit facility bank borrowings, outstanding letters of credit and outstanding commercial paper reduce the available capacity under the credit facility.  PSCo had no direct advances on the credit facility outstanding at June 30, 2012 and Dec. 31, 2011.

Amended Credit Agreement - In July 2012, PSCo entered into an amended five-year credit agreement with a syndicate of banks, replacing the previous four-year credit agreement. The amended credit agreement has substantially the same terms and conditions as the prior credit agreement with an improvement in pricing and an extension of maturity from March 2015 to July 2017. The Eurodollar borrowing margin on the line of credit was reduced from a range of 100 to 200 basis points per year, to a range of 87.5 to 175 basis points per year based on applicable long-term credit ratings.  The commitment fees, calculated on the unused portion of the line of credit, were reduced from a range of 10 to 35 basis points per year, to a range of 7.5 to 27.5 basis points per year, also based on applicable long-term credit ratings.

PSCo has the right to request an extension of the revolving termination date for two additional one-year periods, subject to majority bank group approval.

Letters of Credit - PSCo uses letters of credit, generally with terms of one-year, to provide financial guarantees for certain operating obligations.  At June 30, 2012 and Dec. 31, 2011, there were $3.0 million and $4.9 million of letters of credit outstanding, respectively.  The contract amounts of these letters of credit approximate their fair value and are subject to fees determined in the marketplace.

Money Pool - Xcel Energy Inc. and its utility subsidiaries have established a money pool arrangement that allows for short-term investments in and borrowings between the utility subsidiaries.  Xcel Energy Inc. may make investments in the utility subsidiaries at market-based interest rates; however, the money pool arrangement does not allow the utility subsidiaries to make investments in Xcel Energy Inc.  

The following table presents the money pool borrowings for PSCo:

(Amounts in Millions, Except Interest Rates)	Three Months Ended June 30, 2012			Twelve Months Ended Dec. 31, 2011
Borrowing limit	$	250		$	250
Amount outstanding at period end		5			-
Average amount outstanding		-			3
Maximum amount outstanding		5			53
Weighted average interest rate, computed on a daily basis		0.33	%		0.35	%
Weighted average interest rate at period end		0.34			N/A

Long-Term Borrowings - PSCo plans to refinance the current portion of long-term debt coming due in 2012.