1. Utility Perspective on Climate Change Frank Prager January 22, 2008 Frank Prager January 22, 2008

2. Northern States Power Company- Minnesota 44% Northern States Power Company- Minnesota 44% Public Service Company of Colorado 39% Public Service Company of Colorado 39% Southwestern Public Service 12% Southwestern Public Service 12% Northern States Power Company- Wisconsin 5% Northern States Power Company- Wisconsin 5% 5 th Largest Combination Electric and Gas Utility (based on customers) Gas Customers 1.8 M Electric Customers 3.3 M Gas Customers 1.8 M Electric Customers 3.3 M Member of: Xcel Energy Overview

3. Xcel Energy’s Environmental Leadership #1 Retail wind energy provider Industry-leading voluntary emission reductions Windsource - Largest voluntary green pricing program New technologies: — IGCC, hydrogen, plug-in hybrids, energy storage, carbon sequestration, solar Comprehensive CSR reporting #1 Retail wind energy provider Industry-leading voluntary emission reductions Windsource - Largest voluntary green pricing program New technologies: — IGCC, hydrogen, plug-in hybrids, energy storage, carbon sequestration, solar Comprehensive CSR reporting

4. The Challenge of Climate Change Climate Change policy will require: — Significant emission reductions — Huge capital investments — Long-term technological transformation — A diverse portfolio of resources Clean Technology will lead the way Colorado New Energy Economy Climate Change policy will require: — Significant emission reductions — Huge capital investments — Long-term technological transformation — A diverse portfolio of resources Clean Technology will lead the way Colorado New Energy Economy

5. 0 0 500 1000 1500 2000 2500 3000 3500 1990 1995 2000 2005 2010 2015 2020 2025 2030 U.S. Electric Sector CO 2 Emissions (million metric tons) EIA Base Case 2007 Technology * Achieving all targets is very aggressive, but potentially feasible Advanced Coal Generation Distributed Generation Plug-in Hybrid Vehicles Carbon Capture & Sequestration Efficiency Renewables Nuclear Generation EPRI: Value of Clean Technologies*

6. Goal: Meet customer energy needs cost effectively while reducing emissions 2007 proposed plan: — Renewable energy (including wind and solar) — Energy efficiency and conservation — New gas fired generation — Coal plant retirement Achieves 10% reduction by 2017 2009 filing: evaluate 20% by 2020 scenarios Goal: Meet customer energy needs cost effectively while reducing emissions 2007 proposed plan: — Renewable energy (including wind and solar) — Energy efficiency and conservation — New gas fired generation — Coal plant retirement Achieves 10% reduction by 2017 2009 filing: evaluate 20% by 2020 scenarios 2007 Colorado Resource Plan:

7. 2007 CRP: Wind MW

8. Concentrating solar thermal uses mirrors to concentrate sunlight and heat a transfer fluid — Less expensive for large solar plants (>50 MW) today — Can be combined with thermal energy storage — RFP issued for 25 MW — 200 MW in 2015 Concentrating solar thermal uses mirrors to concentrate sunlight and heat a transfer fluid — Less expensive for large solar plants (>50 MW) today — Can be combined with thermal energy storage — RFP issued for 25 MW — 200 MW in 2015 Parabolic Trough in California 2007 CRP: Solar (CSP) Solar*Rewards Customer Program — Over 1000 systems on line 8.2 MW PV plant in Alamosa, Colorado Solar*Rewards Customer Program — Over 1000 systems on line 8.2 MW PV plant in Alamosa, Colorado

9. 2007 CRP – Energy Efficiency and Conservation Energy Efficiency Goals — 0.7 % of retail sales — 1617 GW-Hr through 2015 — Roughly double current program size — Important part of CO 2 reduction strategy Customer partnership opportunities — Efficiency often first choice in reducing GHG emissions — Lowers energy bills Smart Grid City — Advanced smart grid system Energy Efficiency Goals — 0.7 % of retail sales — 1617 GW-Hr through 2015 — Roughly double current program size — Important part of CO 2 reduction strategy Customer partnership opportunities — Efficiency often first choice in reducing GHG emissions — Lowers energy bills Smart Grid City — Advanced smart grid system

10. 2007 CRP proposes retirement of 229 MW of coal fired generation — Cameo (Grand Junction) 2010 — Arapahoe (Denver) 2012 New natural gas combined cycle at Arapahoe site Additional natural gas likely in All-Source RFP 2007 CRP proposes retirement of 229 MW of coal fired generation — Cameo (Grand Junction) 2010 — Arapahoe (Denver) 2012 New natural gas combined cycle at Arapahoe site Additional natural gas likely in All-Source RFP 2007 CRP: Retirements

11. 2007 CRP and IGCC Integrated Gasification Combined Cycle — Advanced coal gasification technology — Carbon dioxide capture at lower cost Federal support Colorado Legislation (H.B. 06-1281) Evaluated IGCC project — Technology and carbon sequestration effective Integrated Gasification Combined Cycle — Advanced coal gasification technology — Carbon dioxide capture at lower cost Federal support Colorado Legislation (H.B. 06-1281) Evaluated IGCC project — Technology and carbon sequestration effective Delayed filing for approval — Cost, need, partnership and other issues — 2009 – will evaluate whether to file for approval Delayed filing for approval — Cost, need, partnership and other issues — 2009 – will evaluate whether to file for approval

12. Proposed Resource Acquisition Period: 2015 2009 filing: Deal with post 2015 time frame — Evaluate additional reductions – 20% goal — Plant retirements — New clean resources and technology development Proposed Resource Acquisition Period: 2015 2009 filing: Deal with post 2015 time frame — Evaluate additional reductions – 20% goal — Plant retirements — New clean resources and technology development 2009 CRP: The Next Step