Xcel Energy receives recommendations on Minnesota rate case from state agencies

Published 25/08/2025, 19:50
Xcel Energy receives recommendations on Minnesota rate case from state agencies

Xcel Energy Inc. (NASDAQ:XEL) and its subsidiary, Northern States Power Company (NSP-Minnesota), received testimony Friday from several parties regarding the company’s 2024 Minnesota electric rate case, according to a statement based on a recent SEC filing.

NSP-Minnesota originally filed in November 2024 for a two-year, $491 million (13.2%) total revenue increase, with a proposed return on equity (ROE) of 10.3%, a 52.5% equity ratio, and rate base estimates of $13.2 billion for 2025 and $14 billion for 2026. The company, which currently generates annual revenue of $13.96 billion with an ROE of 11%, requested interim rates of $224 million for 2025; the Minnesota Public Utilities Commission (MPUC) approved $192 million in interim rates, effective January 1, 2025, after reducing the request for wildfire mitigation costs.

In March 2025, NSP-Minnesota revised its total revenue request to $473 million. On Friday, eight parties submitted testimony on the case. The Minnesota Department of Commerce (DOC), Office of Attorney General, Xcel Large Industrial Customers (XLI), Citizens Utility Board of Minnesota (CUB), Walmart, and Joint Intervenors quantified proposed financial adjustments.

The DOC recommended reducing the revenue increase to $49 million for 2025 and $167 million for 2026, after adjustments for return on equity, operating and maintenance expenses, generation capacity revenue, depreciation, tax credits, and other items. The DOC proposed an ROE of 9.25%. According to InvestingPro analysis, the stock appears slightly overvalued at its current P/E ratio of 20.37, while offering investors a steady dividend yield of 3.07%. For deeper insights into Xcel Energy’s valuation and comprehensive financial analysis, investors can access the detailed Pro Research Report, available exclusively to InvestingPro subscribers. XLI recommended $190 million in adjustments, including a lower ROE of 8.96% and reduced operating expenses. CUB and Walmart also proposed lower ROEs of 9.00% and 9.25%, respectively, with further adjustments for reconnection and late fee revenues.

Other parties provided issue-specific recommendations. The next steps in the procedural schedule include rebuttal testimony due October 10, 2025, and an Administrative Law Judge report expected by April 30, 2026. The MPUC is expected to make a decision in the third quarter of 2026. Investors seeking to track the impact of this regulatory process on Xcel Energy’s financial health can access additional ProTips and real-time metrics through InvestingPro’s comprehensive platform.

All information is based on a statement from Xcel Energy’s recent SEC filing.

In other recent news, Xcel Energy Inc. reported impressive financial results for the second quarter of 2025, with earnings per share reaching $0.75, surpassing the anticipated $0.66. The company’s revenue also exceeded expectations, coming in at $3.29 billion compared to the forecasted $3.23 billion. Additionally, Xcel Energy announced a significant equity distribution agreement, allowing for the sale of up to $4 billion of its common stock through various financial institutions. This agreement involves major banks and brokerage firms acting as sales agents and forward purchasers. Meanwhile, Xcel Energy’s subsidiary, Northern States Power Company, provided updates on the 2024 Minnesota electric rate case. The company initially filed to increase electric revenues by $491 million over two years, but the Minnesota Public Utilities Commission approved $192 million in interim rates for 2025. These developments reflect ongoing strategic moves by Xcel Energy to strengthen its financial position and regulatory compliance.

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