SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) JULY 27, 1999
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NORTHERN STATES POWER COMPANY
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(Exact name of registrant as specified in its charter)
MINNESOTA
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(State or other jurisdiction of incorporation)
1-3034 41-0448030
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(Commission File Number) (IRS Employer Identification No.)
414 NICOLLET MALL, MPLS, MN 55401
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code 612-330-5500
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(Former name or former address, if changed since last report)
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ITEM 5. OTHER EVENTS
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On July 27, 1999, the Minnesota Public Utilities Commission (MPUC) issued
its order denying Northern States Power Company's (NSP) request for approval of
its bookings of 1998 lost margins, load management discounts and associated
carrying charges related to Minnesota electric conservation programs. In its
order the MPUC contends:
- - NSP is earning above its authorized rate of return.
- - The principal justification for awarding financial incentives for
conservation programs was to motivate utilities to increase their
individual use of demand side management. In recent years, NSP's
conservation expenditures have declined.
- - NSP bears the burden of showing that the requested recovery is
consistent with law and sound public policy. In addition, Minnesota
law requires the MPUC to resolve any doubt about the reasonableness
of the rates in favor of the consumer. The MPUC found the NSP did
not meet its burden in these respects.
In addition, on July 27, 1999, the MPUC voted 3-2 to issue a second
order requiring an investigation into the reasonableness of NSP's electric
rates. The rate investigation order requires NSP to file, within 60 days, a
written explanation and detailed schedules showing the individual adjustments to
the 1998 and projected 1999 normalized rate base, revenue and expense
statements, and the cost of capital that are necessary to reconcile 1998
normalized and 1999 projected returns on equity to the 11.47 percent authorized
return on equity. NSP is also required to explain why it believes its current
rates continue to be just and reasonable. Once NSP has filed the required
information, interested parties will have 60 days to review it and to file
comments and recommendations.
The rate investigation does not authorize the MPUC to reduce base rates,
but only to determine whether a rate proceeding should be initiated. If, after
hearing, the MPUC finds that a rate proceeding should be initiated, it must
then, under Minnesota law, allow the utility 120 days after the MPUC's Order to
file its case. If a rate case is initiated, NSP's rates would first become
subject to refund, as interim rates, 60 days after the filing of the rate
proceeding.
NSP is considering applying for rehearing of the MPUC's July 27, 1999
Orders. These Applications must be filed within 20 days of July 27, 1999. The
filing of these Applications for Rehearing would suspend the effectiveness of
the MPUC's July 27, 1999 Orders until 10 days after the Application is denied or
the MPUC has announced its final determination on rehearing.
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SIGNATURES
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Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Northern States Power Company
(a Minnesota Corporation)
By /s/
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John P. Moore Jr.
Vice President and Corporate Secretary
Dated: July 30, 1999
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