Benjamin Fowke - CFO and VP George Tyson - VP and Treasurer Paul Johnson - Managing Director of IR

Daniele Seitz - Dahlman Rose Paul Ridzon - Key Bank Charles Fishman - A.G. Edwards Dan Jenkins - State of Wisconsin Investment Board Ashar Khan - SAC Capital

Thank you for standing by. Welcome to the Xcel Energy second quarter 2007 conference call. (Operator Instructions) At this time I’d like to turn the presentation over to the Managing Director of Investor Relations, Paul Johnson. Please go ahead sir.

Thank you and welcome to Xcel Energy’s second quarter earnings release conference call. I’m Paul Johnson, Managing Director of Investor Relations. With me today is Ben Fowke, Vic President and CFO of Xcel Energy, and several others who are here to help answer your questions. This morning we’re going to discuss our financial results, the proposed COLI settlement, and updates on business developments and regulatory processes. I also want to point out on our web site there are slides that are available. Please let me remind you that some of the comments we’re about to make contain forward looking statements. Significant factors that could cause results to differ from those anticipated are described in our earnings release, and Xcel Energy filings with the FCC. With that I’ll turn it over to Ben.

Well thanks Paul and welcome everyone. It’s been an outstanding quarter for Xcel Energy, and we have a long list of accomplishments to prove it. We reached a positive settlement in principle in our COLI dispute with the IRS. We achieved constructive outcomes in our natural gas rate cases in both Colorado and North Dakota. Our King Plant came back into service on schedule, and our other major capital projects remain on track and on budget. We signed a contract for a wind farm development project in Minnesota, we filed a combined electric and gas rate case in Wisconsin, and last, but not least, our second quarter financial results were outstanding. Year-to-day, we’re on track with our financial plan. I’ll get into more detail in just a moment, but let me start with second quarter results. I’m very pleased to report earnings from continuing operations of $0.29 per share for the second quarter of 2007, which compares with $0.24 per share for the second quarter of 2006. As I mentioned last quarter, we expected that many of the items that reduced first quarter results would reverse as the year went on. Our strong second quarter indicates that’s exactly what’s happening. Earnings from continuing operations increased by $0.05 per share for the quarter, largely due to higher based electric utility margins, which increased earnings by $0.05 per share, higher short term wholesale and commodity trading margins, which increased earnings by $0.02 per share, lower utility O&M expense, which increased earnings by $0.01 per share, and higher natural gas margins, which increased earnings by $0.01 per share. These positive factors were partially offset by higher depreciation and amortization expense decreased earnings by $0.02 per share, and a higher effective tax rate and other items which decreased earnings by $0.02 per share. Now let’s get into the details. Our base retail electric utility margins increased by 36 million for the quarter, largely increased by various rate increases, riders, and sales growth. Electric revenue and margin increased about 26 million from the PSCo electric retail rate case, and 7 million from the MERP rider. Our weather adjusted sales growth was a solid 1.8% for the quarter, contributing 16 million of increased margins. Our year-to-date weather adjusted sales grew 1.6%, which is in line with our annual guidance range of 1.4-2%. Partially offsetting these margin increases were a reduction in fuel recovery at NSP-Wisconsin, and a negative impact to weather. For more information, please see our earnings release. We also experienced increased margins in our national gas business which increased 9 million during the quarter. The increase here was primarily related to rate increases in Minnesota and North Dakota, and a positive impact from weather. Turning to operating expenses, our second quarter O&M expenses decreased 7 million, or 1. 6% compared with the same period last year. Now remember that our first quarter 2007 O&M expenses were 6% higher than last year, driven largely by the timing of nuclear refueling outages. At that time, I indicated that we expected O&M expenses to moderate throughout the balance of the year. Our second quarter O&M results reflect lower nuclear outage expenses and lower employee benefit costs. The lower benefit costs are largely due to lower medical costs and accrual adjustments to performance compensation, reflecting changes in our stock price. Our year-to-date O&M expenses increased 2.2% which is consistent with our annual guidance range of 2-3% increase over last year. As expected, our second quarter depreciation expense increased 11 million, or 5.4%, driven by plant system expansion. Last month, we filed with the Minnesota commission an amendment to our depreciation petition which may reduce our depreciation expense in 2007. I’ll discuss the impact of this filing in a few moments when I update you on regulatory matters. As far as income taxes are concerned, we had an effective tax rate of 33.4% for continuing operations in the second quarter of 2007. Compared with an effective tax rate of 21.7% in 2006, the lower effective tax rate in 2006 was due primarily to a tax benefit resulting from a reversal of an allowance for capital loss carry-forwards. The higher tax rate during the second quarter of 2007 reduced earnings by approximately $0.05 per share. As a result of the IRS settlement, and the unwinding of the COLI program, we expect our annual effective tax rate will be in the range of 31-34%. This represents a more normalized effective tax rate. Well that covers our results form continuing operations. Total earnings for the second quarter of 2007 were $0.18, compared with $0.24 per share for 2006. Total earnings for 2007 include the loss of $0.11 per share for discontinuing operations, which reflect the impact for the proposed settlement with the IRS regarding disputes associated with our corporate owned life insurance policies, also known as COLI. Let me take a moment to provide some context to the proposed COLI settlement. After disputing this issue for ten years, we’re pleased to be finalizing this positive resolution. While our facts and circumstances were strong, we recognize that a trial presented significant risk, including appeals that could have dragged this issue on for several more years. As part of the proposed settlement we agreed to pay approximately 64 million to the IRS in exchange for a full settlement of all the government’s claims of back tax, interest, and potential penalties relating to the COLI plans. In 2002, as a prerequisite to filing our tax refund law suit, we paid approximately 35 million for taxes related to the COLI program. This means our incremental cash payments to the IRS will be approximately 29 million. Another key aspect of the proposed settlement is that we received a tax free surrender of the COLI policies. As a result, we can, in an efficient manner, unwind the COLI policies and avoid the cost of the program, which average about $0.06 per share annually. Of course, this also means we will no longer enjoy the net benefit of COLI, which provided about $0.05 per share of earnings annually, but is a reasonable compromise to resolve this issue. We talked to a number of investors following this settlement announcement and received very positive feedback. Investors agreed that the proposed settlement was in the best interest of the company. As a result, one analyst upgraded his recommendation on Xcel energy to a buy. The rating agencies were also supportive of the settlement. In fact Fitch upgraded the credit ratings for PSCo in June, citing constructive regulation, and the proposed settlement of COLI. Our Board of Directors has already approved the settlement and we are confident that the IRS and the Department of Justice Tax Division will do the same during the third quarter. Well that wraps up our discussion on the quarterly results, now I’d like to talk about some other accomplishments that we think are going to drive future earnings. In June we filed a certificate of need, a site permit application, and a renewable energy rider for the Grand Meadow wind farm, which is our first project in our strategic initiative to expand Xcel Energy’s wind ownership. Grand Meadow is a 100 megawatt wind farm in Minnesota. The renewable energy rider would be effective in January of 2008 and we expect Grand Meadow to be operating by the end of 2008. In other good news, our construction projects are all on track and very well managed. We continue to make significant progress with our emission reduction effort in Minnesota. We recently brought the King plant back online after significant rehabilitation efforts that included replacing the boiler and steam turbine and adding state-of-the-art air quality control equipment. Our team did a great job managing the project, and we now have a cleaner, more efficient, more reliable King plant back in our fleet. The other MERP projects are also going well. High Bridge is about 60% complete, and should be online in May of 2008. Riverside is about 10% complete and is scheduled to be online in May of 2009. With significant portions of the project wither completed or under contract, we expect to earn an ROE of about 10.7% on these three projects. In Colorado, Comanche 3 construction is approximately 20% complete. All major contracts are signed and design is about 80% complete. Comanche 3 remains on track and on budget. Now let’s take a look at our regulatory initiatives, starting with the cases that we’ve resolved. In June, the Colorado Commission approved a natural gas rate increase of about 32 million, compared with our original request of almost 42 million. The Colorado Commission also approved a partial decoupling mechanism, which will allow PSCo recovery of additional revenues going forward, to compensate for a portion of the declining residential use per customer. Also in June, the North Dakota Commission approved a 2.3 million natural gas rate increase, which was based on an authorized ROE at 10.75%. In North Dakota, we have a complete decoupling and a natural gas business, which insulates us from declining use per customer. Last week in Texas, the Commission ruled on our SPS Electric Rate case, and approved a settlement we reached with various interveners in March. The commission also ruled that the fuel cost allocation associated with the El Paso contract should be based on incremental costs. As a result, there’s approximately 6 million in annual fuel costs that we will not recover through rates. SPS has given notice to El Paso that we intend to terminate the contract based on our regulatory out provision, and we expect a termination will be effective in 2009. We continue to work on resolving fuel reconciliation issues in New Mexico and with FERC. While there are still some outstanding issues, we’re making progress resolving uncertainties and improving the regulatory environment at SPS. Now, let me touch on some pending rate cases. In Minnesota, we have a natural gas rate increase request of 16.8 million pending before the commission. We have been collecting interim rates since early January. We expect the commission to deliberate on this case in August and issue an order in September. In June, NSP-Wisconsin filed a combined rate case with the Wisconsin Commission, requesting a 67.4 million electric rate increase, and a 5.3 million natural gas increase. We expect the commission to reach a decision during the fourth quarter and final rates to be effective in early 2008. In the future we expect to file an electric rate case in New Mexico at the end of July with final rates effective in mid 2008. We also plan to file a Colorado electric rate case in the fall of 2007 and we anticipate that final rates would be effective in mid 2008. While it’s too early to discuss the magnitude of this case, I can tell you that the proposed rate case will be based on a forward test year. We are working to familiarize the Colorado Commissions staff with a forward test year filing as we feel it is an important step to reducing regulatory lag. There’s one last regulatory issue I want to mention. In June, 2007, we filed a request to lengthen the depreciable life for the Monticello nuclear plant by 20 years. In addition, the request sought to change the lives of certain other facilities. This filing was part of an annual review of remaining depreciation lives. If the Minnesota Commission approves our request, effective at the beginning of the year, our depreciation expense would decrease by approximately 31 million. In July, the Department of Commerce filed their comments, which recommended approval of our filing with some minor modifications. The Minnesota Commission is expected to ruling on our filing during the third quarter. So that’s a summary of our regulatory development. When we developed our building the core strategy several years ago, we understood the importance of constructive regulation, and we have worked hard and with success to achieve it. As I have said many times, you have to get the rules right before you embark on a major capital investment program. I think it’s worth taking a moment to emphasize the progress we’ve made in achieving these goals. I want to talk about the recovery mechanisms we have in our main jurisdictions, which are illustrated in the slides on our website accompanying this call. As you are probably aware we have fuel recovery mechanisms and purchase gas adjustment clauses in all our jurisdictions, with the exception of Wisconsin, which has their perspective adjustments handled by the fuel monitoring process. Well first let’s look at the outstanding cost recovery instruments we have at NSP-Minnesota, which represents about 47% of our 2006 net income. Minnesota rate filings are based on forward test years with interim rates. Minnesota also has a number of rate riders, which allows for the recovery of cost, and return from investments, without the delay and uncertainty of filing a rate case. These riders allow for the tiny revenue recovery, and are good mechanisms to recover the costs of large projects or other costs that vary over time. The Minnesota riders include the MERP rider, a transmission rider, a mercury reduction and environmental improvement rider, and a conservation improvement program rider, among others. North Dakota and South Dakota, which are part of NSP-Minnesota, also have several of these recovery mechanisms. In Colorado, which represents about 38% of 2006 net income, we have either implemented or obtained authority for several riders, including a capacity cost rider, a transmission rider, a DSM writer, a renewable energy rider, an air quality improvement rider, any rider to recover IGCC costs if we go forward with this project. In addition, for Comanche 3 we are allowed to earn a forward looking cash return on CWIP when we file a general rate case. We are also allowed to earn on an inequity ratio of 60% to offset the impact of purchase power contracts and the impact of imputed debt. Finally, the next Colorado rate case will be followed on a forward test here to further reduce regulatory lag. Together, NSP-Minnesota and PSCo provide approximately 85% of our earnings, and as you can see, we have riders or enhanced recovery mechanisms for many of our major capital projects and initiatives at these jurisdictions. At SPS, which generates roughly 8% of our 2006 net income, we are making strides towards improving a regulatory environment in Texas and in Mexico. For example, under the settlement just approved in Texas, our next rate case will allow for minimum rate recovery of capacity costs from a power purchase contract that starts in June of 2008. Finally, Wisconsin, which represents about 7% of 2006 net income, we filed rate cases based on forward test years. Historically, Wisconsin has been one of the most constructive state commissions. So with that, I would like to wrap things up. As you can see we’ve had an outstanding second quarter. Based on our solid year-to-date results we are positioned to deliver earnings from continuing operations at either the upper end or exceeding our guidance range of $1.30 - $1.40 per share. Looking forward, we plan to file our Colorado resource plan at the end of October and the Minnesota resource plan in December. These filings will provide more detail on our environmental and renewable strategy, and will lay out the foundation of our resource plan for the next ten years. To provide more information on those strategic plans we are hosting an analyst meeting in New York City on December 5th. More information will be provided to you in the coming weeks and we really hope to see you there. So with that let’s open it up for questions.

(Operator Instructions). Our first question will come from the line of Daniele Seitz with Dahlman Rose. Please go ahead.

Hi Daniele. Daniele Seitz - Dahlman Rose: Hi. I just wanted to ask you a couple of questions on the CapEx. Can you give us an idea of the estimates on the costs of the wind farm? Benjamin Fowke: Yea, the wind farm will be approximately 210 million Daniele. Daniele Seitz - Dahlman Rose: Okay, and could you remind us of the total CapEx for this year and next year? Benjamin Fowke: It’s about 1.9 billion. Daniele Seitz - Dahlman Rose: And same thing for both years? Benjamin Fowke: I’m sorry, what? Daniele Seitz - Dahlman Rose: Same for both years? Benjamin Fowke: Yea, I’m sorry that’s about the number for both years. Daniele Seitz - Dahlman Rose: Ok, great and when do you anticipate, what are you thinking of, in terms of schedule on the IGCC at this time? Benjamin Fowke: What we are planning to do is present it as an option for the commission to review when we file our least cost plan, our resource plan, in Colorado in the fall of this year Daniele. Daniele Seitz - Dahlman Rose: Okay, and assuming that it takes a year for the decision to be made, would you start immediately at that point or is there some lead times, approximate dates you are thinking you could build it for? Benjamin Fowke: I’m sorry Daniele, yeah, there are certainly lead times. The next step in the process, in addition to filing as an option, is to then do the feed study, which will take us into next year. Then we will understand if the project’s approved or not, and we’ll go forward. And if the project were to go forward I think you’re looking at the 2013-2014 timeframe, correct me if I’m wrong. Daniele Seitz - Dahlman Rose: Thanks, appreciate. Benjamin Fowke: Thank you.

Thank you. The next question will come from the line of Paul Ridzon with Key Bank. Please go ahead. Benjamin Fowke: Hey Paul. Paul Ridzon - Key Bank: How are you? Congratulations on the quarter. I had a couple of questions. You threw out a $31 million number, potential nuclear depreciation decrease. Is that for ’07 or is that on a four year basis? Benjamin Fowke: No, that number assumes that the commission approves it and follows the past present of putting it all the way back at the beginning of January 2007. Paul Ridzon - Key Bank: And would we see a revenue requirement decrease offsetting that, or would that drop to the bottom line? Benjamin Fowke: You would see a revenue requirement decrease when we filed a rate case. Paul Ridzon - Key Bank: So you keep the cash until the next rate case? Benjamin Fowke: Yes. Paul Ridzon - Key Bank: And what’s the magnitude of under recovery due to regulatory lag in Colorado that you’re currently experiencing? Benjamin Fowke: Well it’s a historic test here Paul so as you know, as you start to spend more than your depreciation, rate based lag becomes pretty significant. I mean, it depends on a number of factors, but once you get beyond that level that I mentioned, you can see lag eating away returns at about 100 basic points a year. Paul Ridzon - Key Bank: And how much of the drop in O&M was a mark on pension stock? Benjamin Fowke: Well, employee benefits I believe reduced O&M for the quarter by about 12million,and that ass driven by both medical and I think it was fairly balanced medical and performance based comp. Paul Ridzon - Key Bank: And then, just lastly, you mentioned the release at trading results, there was some impact from NSP-Minnesota entering into a wholesales margin settlement agreement, which kind of out of period, how much was that? Benjamin Fowke: I think you’re referring to what we entered into last year. Is that what you’re talking about? I mean last year, remember, as we were filing the retail rate case, we entered into, as part of the settlement, an agreement to share those margins pretty significantly, and that was reflected in the second quarter of 2006. Paul Ridzon - Key Bank: Okay, so we’ve already cycled through a full year of that? Benjamin Fowke: Yep. Paul Ridzon - Key Bank: Okay, those were my questions, thank you. Benjamin Fowke: Thanks Paul.

Thank you, our next question will come from the line of Charles Fishman with A.G. Edwards. Please go ahead. Charles Fishman - AG. Edwards: Charles, good morning. Capacity cost projection for the full year decreased about 10 million? Benjamin Fowke: Yes. Charles Fishman - AG. Edwards: What’s driving that? Benjamin Fowke: Basically, as we actually went through the process of contracting for purchase power, we did a better job in getting that power that we had originally anticipated. Charles Fishman - AG. Edwards: Do you have any - as far as we look towards 2008, will we see a increase in the range of 25 million again? Would that be your best guess at this point. I mean, will this be ongoing? Benjamin Fowke: We’re always going to have some capacity calls, Charles, but I think the range is yet to be determined. One thing to keep in mind is that as SPS, we will have the ability to bring the lead power contract and start recovering that on an interim basis, provided we then follow our rate case, which we’re planning to do. Charles Fishman - AG. Edwards: Okay. And then in Colorado you certainly expressed more confidence in this forward test than in the past. I mean, has something transpired recently that makes you talk more favorably? Benjamin Fowke: Well I think we’ve got a constructive regulatory environment there, and I think we’re working hard to prepare for, not only internally, but also, as I mentioned in the prepared remarks get the staff prepared on what a forward test filing looks like and what their concerns and what they’re going to need to see. And so it’s a focus of ours, and I think if past success is any indicator we will be successful there. We are putting a lot of effort into it Charles. Charles Fishman - A.G. Edwards: Ok, thank you.

Thank you, our next question comes from Dan Jenkins with the State of Wisconsin Investment Board. Please go ahead. Benjamin Fowke: Hi Dan. Dan Jenkins - State of Wisconsin Investment Board: Hi how are you? Just a couple of things, first of all, kind of related to the depreciation extension related to Monticello. Has that plan already received NRC approval for license extension? Benjamin Fowke: Yes, that happened last year. Dan Jenkins - State of Wisconsin Investment Board: How about Prairie Island? Is that part of this process as well? Benjamin Fowke: That is further behind in the curve. That’s an ’08 item. Dan Jenkins - State of Wisconsin Investment Board: Ok, so would you expect probably another change in the appreciation related to when you last got an extension approval for that?

Yeah, I mean I think that remains to be seen, but that’s a logical assumption. Dan Jenkins - State of Wisconsin Investment Board: I’m just curious on the industrial sales if you know what you’re seeing there. Not adjusted for weather, they look like they were somewhat weak. What are you seeing in your service territory as far as industrial demand?

Well, what we’re seeing is last year we started to see, and we reported on, a bit of an economic slowdown on the C and I side, Commercial and Industrial side, particularly in Minnesota, but the trend seems to be improving as of late. And that’s what you’re starting to see reflected in the stronger sales growth that we reported this quarter, Dan. Dan Jenkins - State of Wisconsin Investment Board: Ok, and then the last thing I’m wondering is, as far as there being a lot of construction going on, what do you see as your capital needs? For the second half of the year, do you expect to have to raise any new money, or what’re your plans there?

Well, we’ve outlaid the financing plans in the press release. I guess the big item is we are planning to do a hybrid instrument at the holding company later this year, looking at a range of about 500 million, but no unexpected surprises. Dan Jenkins - State of Wisconsin Investment Board: Okay, thank you.

Thank you, our next question will come from Ashar Khan at SAC Capital. Please go ahead. Ashar Khan - SAC Capital: Good morning.

Hi Ashar. Ashar Khan - SAC Capital: Hey Ben, if I understand, if this depreciation order goes through, that will be an improvement in earnings of around $0.05 or so, right?

Probably more like $0.04, but yes. Ashar Khan - SAC Capital: And then I just wanted to go over the financing. Is there opportunity to do more of hybrid beyond the 500? I’m just trying to see going forward how you plan to meet the gap. Is there more room at the parent to do hybrid in your capital structure?

George, do you want to comment? George Tyson is here, I’ll let him comment.

I think before we definitely want to conclude that we’d like to have the first issuance done. As Ben said, we’re targeting a size of around 500 million. I think if you look at the percentage of hybrid securities that can be accommodated in a capital structure, we think we can go to a higher lever, but we’d really like to complete this initial issuance to determine the market depth and reception for us. But it is a possibility. We could look for greater capacity after this year. Ashar Khan - SAC Capital: Ok great, and then Ben, could you just mention which forward test year are you going to be looking for in the Colorado filing? Is it going to be full year 2008? Is that what the aim is?

Yes. Ashar Khan - SAC Capital: OK, thank you very much.

Thanks Ashar.

At this time we have no additional questions in the queue and I’d like to turn the conference over to you for any closing remarks.

No, I appreciate everybody’s participation in the call. If you any follow-up questions, please feel free to give Paul Johnson in the IR team a call. Thanks to everyone.

Thank you management. (Operator Instructions).