Borrowings and Other Financing Instruments

9 Months Ended

Sep. 30, 2012

Borrowings and Other Financing Instruments [Abstract]

Borrowings and Other Financing Instruments

7.   Borrowings and Other Financing Instruments

Commercial Paper — SPS 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 SPS:

(Amounts in Millions, Except Interest Rates)	Three Months Ended Sept. 30, 2012			Twelve Months Ended Dec. 31, 2011
Borrowing limit	$	300		$	300
Amount outstandingat period end		-			-
Average amount outstanding		-			54
Maximum amount outstanding		16			161
Weighted average interest rate, computed on a daily basis		0.33	%		0.37	%
Weighted average interest rate at period end		N/A			N/A

Letters of Credit — SPS uses letters of credit, generally with terms of one-year, to provide financial guarantees for certain operating obligations. At Sept. 30, 2012 and Dec. 31, 2011, there were no letters of credit outstanding.

Credit Facility — In order to use its commercial paper program to fulfill short-term funding needs, SPS 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 this credit facility. The line of credit provides short-term financing in the form of notes payable to banks, letters of credit and back-up support for commercial paper borrowings.

At Sept. 30, 2012, SPS had the following committed credit facility available (in millions of dollars):

Credit Facility		Drawn		Available
$	300.0	$	-	$	300.0

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

Amended Credit Agreement — In July 2012, SPS 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.

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

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 utility 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 SPS:

(Amounts in Millions, Except Interest Rates)	Three Months Ended Sept. 30, 2012			Twelve Months Ended Dec. 31, 2011
Borrowing limit	$	100		$	100
Amount outstandingat period end		-			5
Average amount outstanding		-			12
Maximum amount outstanding		9			71
Weighted average interest rate, computed on a daily basis		0.33	%		0.35	%
Weighted average interest rate at period end		N/A			0.35

Long-Term Borrowings

In June 2012, SPS issued an additional $100 million of its 4.50 percent first mortgage bonds due Aug. 15, 2041. Including the $200 million of this series previously issued in August 2011, total principal outstanding for this series is $300 million.