XEL_090506

Building the CoreBuilding the CoreExecuting the StrategyExecuting the Strategy

Lehman BrothersLehman BrothersCEO Energy/Power ConferenceCEO Energy/Power Conference

September 5 September 5 –– 7, 20067, 2006

This material includes forwardThis material includes forward--looking statements that are subject to certain looking statements that are subject to certain risks, uncertainties and assumptions. Such forwardrisks, uncertainties and assumptions. Such forward--looking statements looking statements include projected earnings, cash flows, capital expenditures aninclude projected earnings, cash flows, capital expenditures and other d other statements and are identified in this document by the words statements and are identified in this document by the words ““anticipate,anticipate,””““estimate,estimate,”” ““expect,expect,”” ““projected,projected,”” ““objective,objective,”” ““outlook,outlook,”” ““possible,possible,””““potentialpotential”” and similar expressions. Actual results may vary materially. and similar expressions. Actual results may vary materially. Factors that could cause actual results to differ materially incFactors that could cause actual results to differ materially include, but are lude, but are not limited to: general economic conditions, including the availnot limited to: general economic conditions, including the availability of ability of credit, actions of rating agencies and their impact on capital ecredit, actions of rating agencies and their impact on capital expenditures; xpenditures; business conditions in the energy industry; competitive factors;business conditions in the energy industry; competitive factors; unusual unusual weather; effects of geopolitical events, including war and acts weather; effects of geopolitical events, including war and acts of terrorism; of terrorism; changes in federal or state legislation; regulation; costs and ochanges in federal or state legislation; regulation; costs and other effects of ther effects of legal administrative proceedings, settlements, investigations anlegal administrative proceedings, settlements, investigations and claims d claims including litigation related to companyincluding litigation related to company--owned life insurance (COLI); actions owned life insurance (COLI); actions of accounting regulatory bodies; the higher degree of risk assocof accounting regulatory bodies; the higher degree of risk associated with iated with Xcel EnergyXcel Energy’’s nonregulated businesses compared with Xcel Energys nonregulated businesses compared with Xcel Energy’’s s regulated business; and other risk factors listed from time to tregulated business; and other risk factors listed from time to time by Xcel ime by Xcel Energy in reports filed with the SEC, including Exhibit 99.01 toEnergy in reports filed with the SEC, including Exhibit 99.01 to Xcel Xcel EnergyEnergy’’s report on Form 10s report on Form 10--K for year 2005.K for year 2005.

Safe HarborSafe Harbor

Building the CoreBuilding the CoreExecuting the StrategyExecuting the Strategy

Ben FowkeBen FowkeVice President and CFOVice President and CFO

September 5, 2006September 5, 2006

Northern States Northern States Power CompanyPower Company--

MinnesotaMinnesota44% Net Income 44% Net Income

Public Service Public Service Company of Company of

ColoradoColorado39% Net Income39% Net Income

Southwestern Southwestern Public ServicePublic Service

12% Net Income12% Net Income

Northern Northern States Power States Power

CompanyCompany--WisconsinWisconsin

5% Net Income5% Net Income

5th Largest Combination Electric and Gas Utility (based on customers)

5th Largest Combination Electric and Gas Utility (based on customers)

Traditional RegulationTraditional Regulation

2005 EPS $1.20 continuing operations2006 Dividend $0.89 annualized2005 EPS $1.20 continuing operations2006 Dividend $0.89 annualized

Attractive Total ReturnAttractive Total Return

EPS growth rate objective 5 – 7% per year *

Annual dividend growth objective 2 – 4% per year

Dividend yield ~ 4.3%

EPS growth rate objective 5 – 7% per year *

Annual dividend growth objective 2 – 4% per year

Dividend yield ~ ~ 4.3%

* Excluding any impact from corporate-owned life insurance (COLI)* Excluding any impact from corporate-owned life insurance (COLI)

0

7,000

14,000

21,000

28,000

2007 2009 2011 2013 2015

MWMW

Xcel Service Area Growth ContinuesXcel Service Area Growth Continues

Owned GenerationOwned Generation

SupplySupplyRequirementRequirementContracted PurchasesContracted Purchases

Xcel Energy and Wind PotentialXcel Energy and Wind Potential

Wind DensityWind DensityHighHigh

LowLowXcel EnergyXcel EnergyStates ServedStates Served

Source: National Renewable Energy LaboratorySource: National Renewable Energy Laboratory

Diverse, reliable supplyEnvironmentally responsibleFairly priced energy

Diverse, reliable supplyEnvironmentally responsibleFairly priced energy

Strategy: Building the CoreStrategy: Building the Core

Targeted investment to meet increasing customer needs:Targeted investment to meet increasing Targeted investment to meet increasing customer needs:customer needs:

Rate Base $10.8 B $13 B 4.5%Regulatory EquityCapitalization 52% 52 – 54% 0 to 1%Return on Equity 9.6% 10.5 to 11% 2.3 to 3.5%

Rate BaseRate Base $10.8 B$10.8 B $13 B$13 B 4.5%4.5%Regulatory EquityRegulatory EquityCapitalizationCapitalization 52%52% 52 52 –– 54%54% 0 to 1%0 to 1%Return on Equity Return on Equity 9.6%9.6% 10.5 to 11%10.5 to 11% 2.3 to 3.5%2.3 to 3.5%

Earnings Growth DriversEarnings Growth Drivers

AnnualAnnual20092009 GrowthGrowth

20052005 PotentialPotential RateRate

Investment Opportunities 2006 Investment Opportunities 2006 -- 20202020

MERPMERPComanche 3Comanche 3

CapX 2020 Group 1CapX 2020 Group 1Colorado IGCCColorado IGCC

MercuryMercuryCAIRCAIR

License Extension & Uprate:License Extension & Uprate:

Plant Repowering & Uprate Plant Repowering & Uprate New Generation/Gas StorageNew Generation/Gas StorageEnvironmental ImprovementsEnvironmental Improvements

CapX 2020 Group 2CapX 2020 Group 2CapX 2020 Group 3CapX 2020 Group 3

0606 0707 0808 0909 1010 1111 1212 1313 1414 1515 1616 1717 1818 1919 2020

$700$900

$60

$300$700

$100

$700

$30$4

MonticelloMonticelloPrairie IslandPrairie Island

CommittedEstimated CostPotential Investment

Incremental Investment DrivenIncremental Investment Drivenby Economic Signalsby Economic Signals

Customer needManaging costSupportive regulatory treatmentRisk-adjusted return

Customer needManaging costSupportive regulatory treatmentRisk-adjusted return

Increased customer and shareholder valueIncreased customer and shareholder value

Allocation of capital based on:Allocation of capital based on:

Engineering ~ 100% 60% 3%Equipment Purchase ~ 100% 70%Project Cost ~ 90% 76% 20%Construction 60% 25%Completion May May May

2007 2008 2009

EngineeringEngineering ~ 100%~ 100% 60%60% 3%3%Equipment PurchaseEquipment Purchase ~ 100%~ 100% 70%70%Project CostProject Cost ~ 90%~ 90% 76%76% 20%20%ConstructionConstruction 60%60% 25%25%CompletionCompletion MayMay MayMay MayMay

20072007 20082008 20092009

Metro Emissions Reduction Program StatusMetro Emissions Reduction Program Status

HighKing Bridge Riverside

HighHighKingKing BridgeBridge RiversideRiverside

Comanche 3 – 500 MW share of 750 MWsuper-critical pulverized coal plant

Comanche 1 & 2 – Upgrades to environmental systems

Comanche 3 Comanche 3 –– 500 MW share of 750 MW500 MW share of 750 MWsupersuper--critical pulverized coal plantcritical pulverized coal plant

Comanche 1 & 2 Comanche 1 & 2 –– Upgrades to environmental Upgrades to environmental systemssystems

Comanche ProjectComanche Project

Estimated Comanche 3 completion: 2009Estimated Comanche 3 completion: 2009

Engineering 30%Equipment Purchase 90%Project Cost 80%Construction 5%

Engineering 30%Equipment Purchase 90%Project Cost 80%Construction 5%

Percent Complete/Under ContractPercent Complete/Under Contract

Building the Core Building the Core —— TransmissionTransmissionCapX 2020: Collaborative EffortCapX 2020: Collaborative Effort

Three project groups to:Three project groups to:Maintain/improve reliabilitySupport new generationReduce constraints

Maintain/improve reliabilitySupport new generationReduce constraints

Group IIGroup IIGroup IIIGroup III South DakotaSouth Dakota

IowaIowa

MinnesotaMinnesota

WisconsinWisconsin

North DakotaNorth Dakota

Group IGroup I

CapX 2020 CapX 2020 —— 3 Project Groups3 Project Groups

Group I — In-service 2011 – 2012 Total CostSE Twin Cities-Rochester-LaCrosse WI / 345kV $1.3 BillionBemidji - Grand Rapids / 230 kVFargo - St. Cloud/Monticello area / 345 kV Xcel ShareBrookings - SE Twin Cities / 345 kV $700 Million

Group II — In-service 2012 – 2020 To be determinedNew 345 kV transmission loop around the Twin Cities

Group III — In-service 2014 – 2020 To be determinedAs needed and generation projects developed

Preliminary estimated total > $3 Billion

Group I — In-service 2011 – 2012 Total CostSE Twin Cities-Rochester-LaCrosse WI / 345kV $1.3 BillionBemidji - Grand Rapids / 230 kVFargo - St. Cloud/Monticello area / 345 kV Xcel ShareBrookings - SE Twin Cities / 345 kV $700 Million

Group II — In-service 2012 – 2020 To be determinedNew 345 kV transmission loop around the Twin Cities

Group III — In-service 2014 – 2020 To be determinedAs needed and generation projects developed

Preliminary estimated total > $3 Billion

Increasing Our Earned Return on EquityIncreasing Our Earned Return on Equity

Rate Cases with 2006 ImpactsRate Cases with 2006 ImpactsDollars in millionsDollars in millions

Colorado Gas $34.5 $22.0 11.0% 10.5%

Wisconsin Electric 53.1 43.4 11.9 11.0

Wisconsin Gas 7.8 3.9 11.9 11.0

Minnesota Electric * 154 131/115 ** 11.0 10.54

Colorado Gas $34.5 $22.0 11.0% 10.5%

Wisconsin Electric 53.1 43.4 11.9 11.0

Wisconsin Gas 7.8 3.9 11.9 11.0

Minnesota Electric * 154 131/115 ** 11.0 10.54

Dollar IncreaseDollar Increase Return on EquityReturn on EquityRequested GrantedRequested Granted Requested GrantedRequested Granted

* Pending final Commission order* Pending final Commission order** $131 for 2006 reduced to $115 in 2007** $131 for 2006 reduced to $115 in 2007

Colorado Electric Rate Case HighlightsColorado Electric Rate Case Highlights

Requested $210 million increase

Electric rate base = $3.4 billion

11% return on common equity

Equity ratio = 60%

Historical test year with adjustments for known and measurable

Final decision expected late 2006

Rates expected to be in effect early 2007


Electric rate base = $3.4 billion

11% return on common equity

Equity ratio = 60%


Final decision expected late 2006

Rates expected to be in effect early 2007

Under earning: 8.5% ROE vs 10.75% Under earning: 8.5% ROE vs 10.75% $ 64$ 64Increase ROE to 11% and higherIncrease ROE to 11% and higher

equity ratio equity ratio 1717Comanche 3Comanche 3 2424DepreciationDepreciation 3333Wholesale contract expirationWholesale contract expiration 1414Employee related costsEmployee related costs 66OtherOther 2020

$178$178PCCA Impact & Amendment 37 RiderPCCA Impact & Amendment 37 Rider 3232Total requestedTotal requested $210$210

Dollars in millionsDollars in millions

Colorado Electric Rate Case DetailsColorado Electric Rate Case Details

PCCA &PCCA &BaseBase AmendAmend--RatesRates ment 37ment 37 TotalTotal

Increase requestedIncrease requested $ 178$ 178 $ 32$ 32 $210$210ROE 9.5% vs. 11%ROE 9.5% vs. 11% -- 4848Average Comanche rate baseAverage Comanche rate base -- 1313Wholesale contractsWholesale contracts -- 88Incentive compensationIncentive compensation -- 55WeatherWeather--normalizationnormalization -- 44OtherOther -- 99

TotalTotal $ 91$ 91 $ 32$ 32 $123$123

Earnings neutralEarnings neutralDepreciationDepreciation -- 2020 -- 2020

TotalTotal $ 71$ 71 $103 $103


Colorado Electric Rate CaseColorado Electric Rate CaseStaff RecommendationStaff Recommendation

Colorado Electric Rate Case ScheduleColorado Electric Rate Case Schedule

Rebuttal testimony — September 29

Hearings — October 23 through November 9

Statement of positions — November 20

Deliberations — December 1

Initial decision — December 18

Rebuttal testimony — September 29

Hearings — October 23 through November 9

Statement of positions — November 20

Deliberations — December 1

Initial decision — December 18

Texas Electric Rate Case HighlightsTexas Electric Rate Case Highlights


Electric rate base = $943 million

11.6% return on common equity

Equity ratio = 51%


Rates expected to be in effect 1st Quarter 2007


Electric rate base = $943 million

11.6% return on common equity

Equity ratio = 51%


Rates expected to be in effect 1st Quarter 2007

Texas Electric Rate Case ScheduleTexas Electric Rate Case Schedule

Intervenor testimony — October 24 & 31

PUCT staff testimony — November 7

Hearings — November 28 through December 31

Decision date — March 2, 2007

Intervenor testimony — October 24 & 31

PUCT staff testimony — November 7

Hearings — November 28 through December 31

Decision date — March 2, 2007

Potential Additional Rate CasesPotential Additional Rate Caseswith 2007 Impactwith 2007 Impact

Colorado Gas Planned for 2006

Minnesota Gas Planned for 2006

North Dakota Electric Potential

New Mexico Electric Potential

South Dakota Electric Potential

Colorado Gas Planned for 2006

Minnesota Gas Planned for 2006

North Dakota Electric Potential

New Mexico Electric Potential

South Dakota Electric Potential

Des Moines

Des Moines

Des Moines

2005 Average Retail2005 Average RetailElectric Rate ComparisonElectric Rate Comparison

0

4

8

12

16

20

0

4

8

12

16

20Cents per kWhCents per kWhCents per kWh

Amarillo

Amarillo

Amarillo

Kansas City

Kansas City

Kansas CityDenver

Denver

Denver

Mpls/St. Paul

Mpls/St. Paul

Mpls/St. Paul

BostonBostonBoston

Chicago

Chicago

Chicago

Milwaukee

Milwaukee

Milwaukee

Phoenix

Phoenix

Phoenix

Salt Lake City

Salt Lake City

Salt Lake City

6.806.806.80

St. Louis

St. Louis

St. Louis

MiamiMiamiMiami

New York

New York

New York

Washington DC

Washington DC

Washington DC

5.975.975.977.347.347.34

Earnings Guidance RangeEarnings Guidance Range

Regulated utility $1.25 – $1.35Holding company

and other (0.10)COLI – tax benefit 0.10

Continuing operations $1.25 – $1.35

Regulated utility $1.25 – $1.35Holding company

and other (0.10)COLI – tax benefit 0.10

Continuing operations $1.25 – $1.35

20062006

Dollars per shareDollars per share

Financial Performance ObjectivesFinancial Performance Objectives

EPS growth rate target 5 EPS growth rate target 5 –– 7% per year 7% per year **

Annual dividend increases of 2 Annual dividend increases of 2 –– 4% per year4% per year

Deliver an attractive total returnDeliver an attractive total return

Credit ratingCredit rating—— Senior unsecured debt BBB+ to A rangeSenior unsecured debt BBB+ to A range

* Excluding any impact from COLI* Excluding any impact from COLI

AppendixAppendix

Senior Debt RatingsSenior Debt Ratings

Holding Co. BBB+ Baa1 BBB-NSPM A+ A2 A- A A3 BBB-NSPW A+ A2 A- A A3 BBB PSCo A- A3 A- BBB+ Baa1 BBB-SPS A- Baa1 BBB

Holding Co. BBB+ Baa1 BBB-NSPM A+ A2 A- A A3 BBB-NSPW A+ A2 A- A A3 BBB PSCo A- A3 A- BBB+ Baa1 BBB-SPS A- Baa1 BBB

Fitch Moody’s S&P Fitch Moody’s S&PFitch Moody’s S&P Fitch Moody’s S&PSecuredSecured UnsecuredUnsecured

CoalCoal 3636 8,1388,138Natural GasNatural Gas 6161 4,9184,918NuclearNuclear 33 1,6171,617HydroHydro 8383 508508OilOil 2424 492492RDFRDF 66 9696WindWind -- 2525TotalTotal 15,79415,794

2005 OwnedGenerating Facilities

2005 OwnedGenerating Facilities

Unit TypeUnit Type NumberNumber MWMW

* Xcel Energy supplies in * Xcel Energy supplies in excess of 1100 MWs of excess of 1100 MWs of wind powerwind power

**

Xcel Energy Supply SourcesXcel Energy Supply Sources

Nuclear10%

Nuclear10%

Coal **45%

Coal **45%

Gas & Oil38%

Gas & Oil38%

* Includes purchases** Low-sulfur western coal* Includes purchases** Low-sulfur western coal

Renewables7%

Renewables7%

2005Energy Supply Mix*

2005Energy Supply Mix*

Nuclear Relicensing StatusNuclear Relicensing Status

License renewal approvals expected 2006Life Cycle and power uprate modificationsto be installed 2008 – 2012

License renewal approvals expected 2006Life Cycle and power uprate modificationsto be installed 2008 – 2012

License renewal application— Submit to NRC and Minnesota PUC in 2008— Approvals expected mid 2010Unit 2 steam generator replacement expected 2013

License renewal application— Submit to NRC and Minnesota PUC in 2008— Approvals expected mid 2010Unit 2 steam generator replacement expected 2013

MonticelloMonticello

Prairie IslandPrairie Island

Minnesota Cost Recovery MechanismsMinnesota Cost Recovery MechanismsProjected electric fuel and purchased energy costs billed for the current month with subsequent true-up; MISO costs recovered through FCA on interim basis, with final recovery mechanismbeing developed by stakeholders

Projected purchased gas cost billed for the current month with subsequent true-up

Conservation Improvement Program rider which providesrecovery of program costs plus incentives

Metro Emission Reduction Program, Renewable Development Fund and State Energy Policy rider in place

General Transmission rider authorized by law

Mercury Reduction and Environmental Improvement rider authorized by law

Projected electric fuel and purchased energy costs billed for thProjected electric fuel and purchased energy costs billed for the e current month with subsequent truecurrent month with subsequent true--up; MISO costs recovered up; MISO costs recovered through FCA on interim basis, with final recovery mechanismthrough FCA on interim basis, with final recovery mechanismbeing developed by stakeholdersbeing developed by stakeholders

Projected purchased gas cost billed for the current month with Projected purchased gas cost billed for the current month with subsequent truesubsequent true--upup

Conservation Improvement Program rider which providesConservation Improvement Program rider which providesrecovery of program costs plus incentivesrecovery of program costs plus incentives

Metro Emission Reduction Program, Renewable Development Metro Emission Reduction Program, Renewable Development Fund and State Energy Policy rider in place Fund and State Energy Policy rider in place

General Transmission rider authorized by lawGeneral Transmission rider authorized by law

Mercury Reduction and Environmental Improvement rider Mercury Reduction and Environmental Improvement rider authorized by lawauthorized by law

Colorado Cost Recovery MechanismsColorado Cost Recovery MechanismsEnergy Cost Adjustment recovers electric fuel and purchased Energy Cost Adjustment recovers electric fuel and purchased energy costs (through 2006) energy costs (through 2006) –– Filed for new planFiled for new plan

Monthly Gas Cost Adjustment recovers natural gas commodity, Monthly Gas Cost Adjustment recovers natural gas commodity, interstate pipeline and storage costsinterstate pipeline and storage costs

Purchased Capacity Adjustment recovers the demand component Purchased Capacity Adjustment recovers the demand component of purchased power contracts (through 2006) of purchased power contracts (through 2006) –– Filed for new plan Filed for new plan

Fuel Cost Adjustment recovers electric fuel and purchased energyFuel Cost Adjustment recovers electric fuel and purchased energycosts from wholesale customerscosts from wholesale customers

DemandDemand--side Management Cost Adjustment rider (gas and side Management Cost Adjustment rider (gas and electric) and Air Quality Improvement rider (to recover cost of electric) and Air Quality Improvement rider (to recover cost of emissions controls on several Denver metro generation facilitiesemissions controls on several Denver metro generation facilities))

Recovery of Comanche 3 construction workRecovery of Comanche 3 construction work--inin--progress progress

Recovery of expenditures for renewable mandateRecovery of expenditures for renewable mandate

Rider recovery of IGCC investmentRider recovery of IGCC investment

2005 Rate Base and Returns2005 Rate Base and Returns

Colorado Electric $3,120 8.5%Colorado Gas 1,084 7.00Minnesota Electric 3,230 10.61 9.98%Minnesota Gas 422 6.30 7.42North Dakota Electric 175 12.46 12.65North Dakota Gas 42 5.71 6.81South Dakota Electric 191SPS Electric 1,422Wisconsin Electric 613Wisconsin Gas 83

Colorado Electric $3,120 8.5%Colorado Gas 1,084 7.00Minnesota Electric 3,230 10.61 9.98%Minnesota Gas 422 6.30 7.42North Dakota Electric 175 12.46 12.65North Dakota Gas 42 5.71 6.81South Dakota Electric 191SPS Electric 1,422Wisconsin Electric 613Wisconsin Gas 83

Rate Weather-Base Actual NormalizedRateRate WeatherWeather--BaseBase ActualActual NormalizedNormalized

** Reflects regulatory reporting requirementsReflects regulatory reporting requirements**** Electric and GasElectric and Gas

Return on Equity *Return on Equity *Return on Equity *

6.26 **6.26 **


CorporateCorporate--Owned Life InsuranceOwned Life InsuranceLitigation (COLI)Litigation (COLI)

Positive pre-deduction cash flowsMortality gainsThe buildup of cash values

Positive prePositive pre--deduction cash flowsdeduction cash flowsMortality gainsMortality gainsThe buildup of cash valuesThe buildup of cash values

The courtThe court’’s opinion in the Dow case outlined three indicators s opinion in the Dow case outlined three indicators of potential economic benefits to be examined in a COLI case. of potential economic benefits to be examined in a COLI case.

In Xcel EnergyIn Xcel Energy’’s COLI case, the plans:s COLI case, the plans:Were projected to have sizeable preWere projected to have sizeable pre--deduction cash flows, deduction cash flows, based upon the relevant assumptions when purchasedbased upon the relevant assumptions when purchasedPresented the opportunity for mortality gains that were not Presented the opportunity for mortality gains that were not eliminated either retroactively or prospectivelyeliminated either retroactively or prospectivelyHad large cash value increases that were not encumbered Had large cash value increases that were not encumbered by loans during the first seven years of the policiesby loans during the first seven years of the policies

Economy & Finance

XEL_090506