Paul A. Johnson - Vice President of Investor Relations & Business Development Benjamin G. S. Fowke - Chairman, Chief Executive Officer and President Teresa S. Madden - Chief Financial Officer and Senior Vice President

Michael Weinstein Paul T. Ridzon - KeyBanc Capital Markets Inc., Research Division Glen F. Pruitt - Wells Fargo Securities, LLC, Research Division Lauren B. Duke - Deutsche Bank AG, Research Division

Good day, ladies and gentlemen, and thank you for standing by. Welcome to the First Quarter 2014 Earnings Conference Call. [Operator Instructions] I would now like to turn the conference over to Paul Johnson, Vice President of Investor Relations. Please go ahead. Paul A. Johnson: Good morning and welcome to Xcel Energy's 2014 First Quarter Earnings Release Conference Call. Joining me today are Ben Fowke, Chairman, President and Chief Executive Officer; Teresa Madden, Senior Vice President and Chief Financial Officer; Dave Sparby, Senior Vice President, Group President and President and CEO of NSP-Minnesota; Scott Wilensky, Senior Vice President and General Counsel; and George Tyson, Vice President and Treasurer. This morning, we'll review our 2014 first quarter results, update you on recent business and regulatory developments and reiterate our 2014 guidance. Slides that accompany today's call are available on our web page. In addition, we'll post a brief video of Teresa summarizing our financial results on our web page. As a reminder, some of the comments during today's conference call may contain forward-looking information. Significant factors that could cause results to differ from those anticipated are described in our earnings release and our filings with the SEC. I'll now turn the call over to Ben. Benjamin G. S. Fowke: Thank you, Paul, and good morning. Overall, it was another strong quarter for Xcel Energy. I'm pleased to report that ongoing earnings for the first quarter of 2014 were $0.52 per share, compared with $0.48 per share for the first quarter of 2013. Our solid financial results were driven by rate increases, favorable weather and higher than expected weather adjusted sales growth. This positions us well as we head into the important summer months. Let me elaborate a bit more. The harsh winter we experienced in the upper Midwest increased earnings by almost $0.05 compared to a normal winter. Additionally, as you also know, extreme cold or heat, while improving the financial outlook, can also bring its share of operational challenges and this winter was certainly no exception. In fact, on Saturday, January 25, a rupture occurred on one of our supplier's natural gas pipelines in Canada, when temperatures were more than 20 degrees below 0 in our northern service territories. This rupture also caused 2 other pipelines to be removed from service for safety reasons, which significantly restricted the flow of natural gas into the region. Our employees worked around the clock with our suppliers and our customers to ensure that we avoided a potentially devastating natural gas outage. The results of those proactive steps, along with the tremendous willingness of our customers to conserve, prevented what could have been a very dangerous situation. Instead, by Monday, we had resumed service back to normal. For me, it speaks volumes about our ability to respond to an operational challenge. It also reminds all of us at Xcel Energy of the need to continue to invest, plan and strive for operational excellence to provide our customers the safe and reliable energy they expect. And besides weather, we're also seeing some potential upside for the year based on improving sales growth. And while it may a bit too early to call a trend, especially in light of the volatile weather we experienced, I am encouraged by the pickup we're beginning to see in sales, particularly in our commercial and industrial class. And Teresa will provide you more detail on this in a few minutes. This quarter, in addition to delivering strong financial performance, we continued to pursue our environmental goals which we believe are important to our long-term success. I'm proud to announce that AWEA has named us the #1 wind provider in America for the 10th consecutive year. Providing our customers with renewable energy at the right cost and in the most efficient manner continues to be a high priority. We support solar generation and believe there is a right way to do solar to maximize the benefit for all customers. As a result, we've undertaken several initiatives. In Colorado, we recently proposed a new program called Solar*Connect, which will provide our customers energy options from large-scale solar projects. The program will complement rooftop solar offerings and solar gardens, and give customers alternatives for buying solar power. Our goal is to make solar energy accessible to all customers even if they don't have the ability to put photovoltaic panels on their home or business. In Minnesota, we recently issued an RFP for up to 100 megawatts of large-scale solar generation to be installed by 2016. This RFP will help us meet the state solar mandate in a cost-effective manner. Both of these initiatives take advantage of the efficiencies of large-scale solar and provide our customers with additional renewable options. It demonstrates our commitment to have solar as a key component of our resource portfolio, and reflects our intention to see solar done the right way. And as always, we're very focused on continuing to deliver shareholder value. In February, we increased our dividend by 7% to ensure that we provide an attractive dividend yield. The increase also reflects our flexibility as a result of our strong balance sheet, a relatively low payout ratio and the confidence we have in our business plan. Our long-term objective is to grow the dividend 4% to 6% annually. So with that, I'll turn the call over to Teresa. Teresa S. Madden: Thank you, Ben, and good morning. As Ben indicated, we are pleased to report another solid quarter with earnings of $0.52 per share, compared with 2013 first quarter earnings of $0.48 per share. In summary, drivers of the favorable results included new and interim rates being implemented across several jurisdictions, positive weather and higher than expected weather adjusted sales. These positive factors were partially offset by higher O&M and property taxes. Let me start by providing an update on sales and the economies in our local service territories. Overall, sales growth was stronger than expected for the quarter. Weather-adjusted retail electric sales increased 2%, and firm natural gas sales increased 3.7%. While growth was favorable across the board, it varied by operating company. We have added a table to our earnings release that breaks down sales by utility to provide you with more detail. Beginning with SPS, weather-adjusted retail electric sales increased 4%, largely driven by growth in the C&I class, although we saw strong residential growth. The energy sector continues to provide a positive impact from oil and gas drilling activities in the Southeastern New Mexico Permian Basin area. Additional load growth in ethanol production and uranium enrichment also contributed to the higher sales. Weather-adjusted retail sales at NSP-Wisconsin increased 3.3%. C&I sales were strong, primarily due to increased load from one of our larger customers that was operating their pipeline at reduced capacity in the first quarter of 2013, but returned to full capacity in 2014. Residential customer growth, combined with slightly increasing use per customer, drove residential sales. Additionally, propane shortages in the region likely contributed to the strong growth. As a result, we don't think this represents a sustainable growth trend. Weather-adjusted retail electric sales at PSCo increased 1.4%, primarily driven by higher average use in the small C&I class, a new cheese factory, along with recovery at a steel mill and customer growth in the residential class. Finally, weather-adjusted retail electric sales at NSP-Minnesota, increased 1.2%, led by C&I sales growth of 1.5% and modest residential sales improvement. Economic conditions are generally stronger across the Xcel Energy region compared to the nation as a whole. The consolidated unemployment rate in our service territory of 5.4% remains well below the national average of 6.8%. In addition, the number of jobs in the Xcel Energy region grew 2.2% for the quarter compared with 1.7% for the nation. As Ben mentioned, while we are encouraged to see better than expected sales, it is still too early to declare this a trend. Regardless, we have adjusted our annual sales guidance to reflect our year-to-date performance. As a result, we now anticipate electric sales growth of up to 1% for 2014. Turning more specifically to first quarter earnings. Electric margin increased $68 million for the quarter. Key drivers included final and interim rates which increased margin by $38 million, severe cold weather increased margin by $21 million. To put this in perspective, in Minnesota, it was the 9th coldest quarter on record, and the coldest quarter since 1979. In addition, stronger than anticipated weather-adjusted sales increased margin by $12 million. These positive impacts were partially offset by the recognition of a reserve for potential custom refund at PSCo as well as other items. The reserve for a customer refund highlights the success of the 2012 3-year rate plan we implemented in Colorado. Over the last 3 years, we have earned above our authorized return in our PSCo electric business. The multiyear plan included an earnings test which provides for the sharing of earnings above a 10% ROE between customers and the company. As a result, both the company and customers have benefited from the multiyear plan. Clearly, this demonstrates the advantage of a multiyear plan and supports our strategy of implementing this approach in other jurisdictions. Turning to the natural gas side of the business, margin increased by $25 million. This was largely due to rate increases, cold weather and additional revenue recovered through the pipeline integrity rider in Colorado. O&M expenses increased $31 million or 5.8%. Key drivers include nuclear costs as well as distribution and transmission expenses. It's important to point out that this deviation does not represent our planned run rate for the year. The quarterly deviation is skewed due to the timing of O&M expenses in 2013, which were at their lowest point in the first quarter. This was primarily due to the extended outage at our Monticello nuclear plant as part of the light extension and power upgrade project, which was completed and the plant came back online in the summer of 2013. As a reminder, our nuclear outage costs are deferred during the outage and then amortized over the following 18 to 24 months. In addition, our O&M costs were at their highest level in the third and fourth quarters of 2013. Following the positive summer weather earnings impact, we decided to increase our investment in the system in the latter part of the year, which served to increase O&M in the third and fourth quarters of 2013. As a result, we continue to expect that our 2014 O&M expenses will increase 2% to 3% consistent with our original guidance assumption. Finally, other taxes increased about $11 million or 10%, primarily driven by higher property taxes in Minnesota and Colorado. Next, I will provide some detail on the financial results of each of our operating companies. NSP-Minnesota earnings were flat for the quarter. Colder weather and interim electric rate increases in Minnesota and North Dakota, effective in January 2014, were offset by higher O&M expenses, primarily nuclear driven, and lower AFUDC. It is also important to point out that the results for the first quarter of 2013 reflect interim rates in Minnesota which were recorded at a level higher than the final rates implemented later in 2013. PSCo's earnings were also flat for the quarter. Higher rates and sales growth were offset by increased property taxes, depreciation and accruals associated with the electric earnings test refund obligation. SPS's earnings increased $0.02 per share for the quarter, primarily due to higher electric rates implemented mid-year 2013 and an interim rider designed to recover costs associated with transmission infrastructure in Texas, partially offset by O&M expenses. NSP-Wisconsin earn increased -- earnings increased $0.01 per share for the quarter due to colder weather and an electric rate increase effective in January 2014, partially offset by higher O&M expense. Next, I'll comment on several regulatory proceedings. Additional details are included in our earnings release. I will begin with the recently concluded cases. As we've previously discussed, the primary objective of our regulatory strategy is to implement multiyear plans in our various jurisdictions. In North Dakota, the Commission recently approved a comprehensive 4-year settlement agreement which covers 2013 through 2016. The multiyear plan provides for annual rate increases of 4.9% for the first 3 years, and no rate increase in the final year. The plan also includes an increasing ROE from 9.75% to 10.25% during this multiyear period. In New Mexico, the Commission recently approved an overall rate increase of approximately $33 million, based on a forward test year, an ROE of 9.96% and our requested equity ratio of 53.9%. Both of these decisions represent constructive outcomes and a good start to the regulatory calendar. Now turning to our pending cases. In Minnesota, we filed a 2-year electric rate case that covers both 2014 and 2015. Interim rates went into effect in January. At this point, it is very -- fairly early and we are still in the discovery stage of the process. The procedural schedule has been established and key dates include: intervener testimony is due in June; the ALJ report is scheduled for December; and a final decision in this case is expected in March of 2015. The Monticello prudence review is following a similar timeline for the Minnesota rate case. We are also in the discovery phase of this proceeding. Key dates for the procedural schedule include: intervener testimony is due in July; the ALJ report is scheduled for December; and a final decision on the Monticello prudence review is expected in March of 2015. The results from the final decision will be implemented as part of the Minnesota rate case decision. In Texas, we have requested a net increase in electric rates of $48.1 million or 5.3%. Intervener testimony is due in May and hearings are planned for June. We anticipate a final decision, with implementation of new rates in the third quarter. However, I should point out that we have been in settlement discussions with various parties and are hopeful that we can come to an agreement in the near term. We are also preparing several filings for our other jurisdictions. In Colorado, our multiyear electric plan ends in 2014. We anticipate that the 2015 through '17 rate deficiency will be modest, with the key drivers being increased property taxes and capital costs associated with the Clean Air-Clean Jobs project. Our goal is to, again, implement a regulatory plan covering multiple years. We have been meeting with key stakeholders to discuss various options for moving forward. In addition to a multiyear plan, we are also considering other approaches, including the implementation of riders to recover property tax and costs associated with the Clean Air-Clean Jobs project. As we get input from our customers and other parties, we will determine the specific path that we will pursue. We also plan to file a limited reopener in Wisconsin as well as an electric rate case in South Dakota in late spring or early summer. These rate cases should be resolved by year end and will provide us with regulatory certainty in 2015. So, turning to our financing plans, in March, PSCo issued $300 million of 30-year first mortgage bonds at a very attractive coupon of 4.3%. We plan to issue the following first mortgage bonds during the first half of the year. Approximately $300 million at NSP-Minnesota; approximately $150 million at SPS; and approximately $100 million at NSP-Wisconsin. In the first quarter we also issued approximately $78 million of equity, or 2.6 million shares, at an average price of $30.22 per share through our aftermarket, or dribble, program. This has proven to be a cost-effective method for us to issue equity. Additionally, we continue to review our future financing plans and believe we may have the flexibility to reduce our previously forecasted equity needs over the next 5 years based on strong -- our strong balance sheet and credit metrics. Further, we are analyzing the potential impact of the possible extension of bonus depreciation. We will continue to evaluate our financing plans and expect to provide an update later this year. Finally, I want to mention that during the quarter Moody's upgraded the credit ratings of Xcel Energy and its subsidiaries one notch. The outlook is stable. This morning we are reaffirming our 2014 ongoing earnings guidance of $1.90 to $2.05 per share. Please note, we've updated certain guidance assumptions. Details of these changes can be found in today's press release. While we've had some positive weather and sales have been stronger than expected, we believe it is too early in the year to provide a more comprehensive update related to our 2014 earnings guidance expectations. With that, I'll wrap up my comments. Clearly, we had another strong quarter, which is a great start to the year. We continue to make progress on the regulatory front with the constructive completion of rate cases in North Dakota and New Mexico. We are well-positioned to deliver on our 2014 earnings guidance and long-term financial objective of growing earnings and our dividends 4% to 6% annually. Finally, we are looking forward to hosting our annual meeting in Fargo, North Dakota on May 21. North Dakota is a state of growth and opportunity and we are proud to serve this fine community. So with that, operator, we will now take questions.

[Operator Instructions] Our first question comes from the line of Michael Weinstein with UBS.

Could you talk a little bit more about Black Dog and the process for getting a PPA there? What's going wrong with it? I think what we heard on the Calpine call was that they are now saying that this process might go into late 2014, maybe early '15. Benjamin G. S. Fowke: First, let me just clarify. Black Dog is our self-build option, and Calpine, of course would be the PPA, power purchase agreement option that we referred to. And what the Commission instructed us to do is basically negotiate with all parties' top line and energy and continue to look at our own options and present them the alternatives. Timeframe is later in the year. Teresa S. Madden: Yes, we're required to respond by October. So then, it would be deliberated on after that. So that timeline is probably fairly consistent.

And our next question is from the line of Paul Ridzon with KeyBanc. Paul T. Ridzon - KeyBanc Capital Markets Inc., Research Division: A question unrelated to the quarter, but just given what's happened at the Supreme Court with CASPR, kind of how should we book-end the potential impact on your capital plans? Benjamin G. S. Fowke: That's a great question, Paul. We were pretty concerned about that ruling, particularly in Texas. But a lot's happened since 2011. We've -- within SPS, we've added 700 megawatts of renewables. We've put on a more efficient gas plant in Jonesboro, we've put some abatement equipment on. And then given MATS and low gas prices across the nation, we've seen more retirements of coal plants. So the allowance market has increased significantly. So the bottom line is we don't see it as very significant to our capital plans. As a matter of fact, I mean, more to come on this. And I think it's going to be interesting to see what EPA ultimately does with this decision. But the bottom line is we think any gaps that we may have in compliance right now, we can probably meet with the purchase of allowances, which would be pretty minimal and with flow-through fuel recovery mechanisms that we have. Paul T. Ridzon - KeyBanc Capital Markets Inc., Research Division: And then just any update on Boulder? Benjamin G. S. Fowke: Not too much. There's been some administrative things. In April the city went -- did the first vote on forming a power and light utility. It's, I think it's part of the process they need to go through to be able to issue bonds. It's kind of part of the formal process. So we also continue to work with officials to try to craft some kind of solution that might work for both parties to avoid the municipalization, but right now that's the path we're on, and it's a long path. As we've talked about before, it's going to take more than 3 years probably to see all this through.

And our next question is from the line of Glen Pruitt with Wells Fargo. Glen F. Pruitt - Wells Fargo Securities, LLC, Research Division: My question has to do with the solar programs you mentioned in your planned remarks. Over the last several years, a lot of companies have offered solar and renewable options to customers. Primarily, they were focused on just offering some percentage of your bill from solar or other renewables. I was wondering if you could give me some idea how your programs are different from those programs? Because they haven't been well received by customers in a lot of places. Benjamin G. S. Fowke: I can't speak to other places, but our Windsource program has been extremely popular. And so we're trying to augment that particular program, starting in Colorado with the Solar*Connect program. It gives people that perhaps don't want to put panels on their roof or can't afford to or aren't in the right position because of their angle to the sun to have another option to have more renewable energy in their energy mix. So I think the -- I think our programs in the past have been well received. I think this program, the initial response is, well, it's generally favorable. Teresa S. Madden: Maybe I would just add to that. The Solar*Connect program we think will be also more cost-effective than adding just solar to rooftop. It would potentially be about half the cost, in terms of having centralized solar as the resource. Benjamin G. S. Fowke: Yes, I mean, that's our whole intention. That's how we've -- look, we are a leader in renewables. I mean, 10-year running as the #1 wind provider in a the United States. Supportive of solar across all of our territories. But we're also very diligent at bringing on renewables at the right price point for all customers, and we want to continue to do that. It's extremely important that we never lose sight of what we're trying to accomplish with renewables, which in my mind is reducing carbon in an efficient manner. And we want to do that as efficiently as possible, as transparently as possible and as fairly as possible to all customers. Glen F. Pruitt - Wells Fargo Securities, LLC, Research Division: Okay, and one follow-up question, not related. Considering some of the issues that are -- other utilities are having related to coal ash storage. Do you foresee any potential issues at your fossil plants and any possible future investment due to this new focus? Benjamin G. S. Fowke: No. Not really. Our disposals are quite a lot different than the issues you saw back on the East Coast. Clearly, we're going to watch and see if the EPA does turn around and classify coal ash as a hazard, that could drive up some expense. But the Ponnes themselves were in very good shape. As a matter of fact, EPA has given us very, very high marks for our Sherco plant, which would be the -- it's not close but it'd be the closest thing related to the some of the Ponne-ash disposal -- or Ponne-ash facilities on the East Coast.

[Operator Instructions] Our next question is from the line of Lauren Duke with Deutsche Bank. Lauren B. Duke - Deutsche Bank AG, Research Division: I wanted to ask about Colorado. You mentioned considering your options as your multiyear plan expires. And clearly, you guys are very happy with how the plan has turned out. What about the other parties to the settlement? I mean, do you get the sense that they are similarly pleased with how that worked out? Meaning, you think you could come forward with another multiyear settlement? And in the absence of a settlement, do you still feel comfortable that the Commission would be willing to approve one given what happened on the gas side? Benjamin G. S. Fowke: I think, by and large, the parties are happy with the multiyear plan. We -- you always have to go back and kind of review what you entered into and how it actually worked. We had some pleasant upside surprises, sales and tax things. Cost-containment that we initiated that really helped to make, I think, the multiyear plan work for all parties. I think the Commission is supportive of a multiyear plan. I also think, as Teresa mentioned, the drivers of what we need over the next several years, are really pretty specific. And it's recovery of the investments we're making under the Clean Air-Clean Jobs program. And it's recovery of property taxes. So I mean, the ask isn't going to be as big as I think parties maybe had perceived, and I think the pathway to settlement and the pathway to getting either a multiyear or a rider-type program in place, are, I think the prospects are pretty good.

Thank you. And I'm showing no further questions. I'll turn the call back to Teresa Madden for closing comments. Teresa S. Madden: Well, thanks, everyone. If you have any follow-up questions, please contact Paul Johnson and the IR team. Thank you.

Ladies and gentlemen, this concludes our conference. Thank you for your participation. You may now disconnect.