ML20070U783
| ML20070U783 | |
| Person / Time | |
|---|---|
| Site: | Fort Saint Vrain  |
| Issue date: | 12/31/1990 |
| From: | Brey H PUBLIC SERVICE CO. OF COLORADO |
| To: | NRC OFFICE OF INFORMATION RESOURCES MANAGEMENT (IRM) |
| References | |
| P-91110, NUDOCS 9104090316 | |
| Download: ML20070U783 (57) | |
Text
{{#Wiki_filter:_ _ - - _ - - - _ _ _ - _ - _ _ _ _ _ _ _ _ _ _ ._ e o h Public Sery ce# = ;." % .e. 2420 W -26th Avenue, Suite 100D, Denver, Colorado 80211 March 29, 1991 Fort St. Vrain Unit No. 1 P-91110 g U. S. Nuclear Regulatory Commission ATTN: Document Control Desk ' Washington, D.C. 20555 Docket No. 50-267
SUBJECT:
Annual Financial Report Gentlemen: Enclosed are ten (10) copies of the 1990 Annual Report for Public Service Company of Colorado, including the certified financial statement for 1990. This document is submitted for your information and use in eccordance with 10 CFR 50.71(b). Very truly yours, J mhtLCL M. % 0 H. L. Brey, Manager Nuclear Licensing and Resource Management Division MLB/DCG: bit Enclosures cc: Regional Administrator, Region IV 611 Ryon Plaza Dr. Suite 1000 Arlington, TX 76011 Mr. J. B. Baird Senior Resident Inspector Fort St. Vrain
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- Our Business Public Service Company of Colorado $
Public Service Company of Colorado is an electric, natural gas and thermal energy utility serving approximately 75 perc ent of Colorado's three million people, including the Contents'
- Denver metropolitan area. The company's consolidated tinancial statements include the results of its subsidiary ThulalIUWW$ 2 operations: 1990-At a Glance 3 Cheyenne 1.ight, Fuel & Power Company, an electric and To Our Shareholdsn 5 natural gas company serving the Cheyenne, W3 oming area; liard Won Strategies 8 Fuct Resources Deselopment Co., an oil and gas exploration. g gg g development and production company with operations throughout the Rocky Mountain region; Ensuring the l'uture 12 Western Gas Supply Company, a natural gas transmission Our Energy lluslaess 14
' *E#"U Taking the 1. cad 16 Bannock Center Corporation, a real estate investment company; S h4 Om Cehm M Setting the Pace 19 Welton Properties, a company that owns and manages utility real estate: OperatingStatistics 20 IN Colora lo Credit Corporation und P.S.R. Im estments, Inc., Financial and Statistical Data 21 two finance subsidiaries; Management's Discuss!ciiand Analysis 22 Naturni Fuels Corporation, which sells compressed naturo! -- Rtp rt rom Management 27 gas as a transportation fuel to retail markets, Reports from AuditCommitteeand Independent Public Accountants 28 Consolidated Financial Information 29 Notes to Consolidated Financial Statements 34 Shareholder Information 52
cGreates: Resource in the past, corporate America tended to look the same, to share the same culture. That cliche has been rejected at Public Service Co. The one constant among our emplo, ees is that they value diversity and understand how perspectives from many different and talented individuals can join to achieve the common goal of corporate profitability and good citizenship. Differing cultures, races, backgrounds and opinions are part of our strength, and we feel that we are well on our way to achieving a truly pluralistic work force. Now the management challenge is to give our employees the free- + dom to seek opportunities, to make each problem their own, and through teamwork find solutions that benefit our customers and shareholders. Our senior management team is leading and empow-ering our employees so that they can get the job done. i 1
l'ercenttge of blale, Female ,,,,, l*g ,, end hilnorit) Emplopes u.i. ,,,,,.w .u,,,, w.. iam u. in,i, in.,a u ,,,,,,n , n n, et Year End 1989 and 1990 im im no im im im iyn im im im im im im im im im
. nu n+ m m n,w w,um , uo. am i u' i o o ic 83 t in i ic s u s i ,4
% of Tsu! 76 4 '56 2) 0 24 4 0 O2 I ) li IJ ' 'Ib
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% iv}%,n-st,qagge91 ]i3_ ]49 2 4, ? 2h 0 , 0,2 _ 0_1 13 j i () 4 14 2 t> i 6J _ _21 5 11 4 't1 $ JFf HallCIEC 0;erc.onsI r.o ..,ms b
Financial 1990 1989 % Change Earnings Per Share $2.49 $ 2.59 (3.9) Dividends Paid Per Share $2.00 $ 2.00 - Returnon AscraneCommon Shareholder Equi'y 14.3 9 15.4 % (7.1) Common Shareholder Equity-42,0 9 %i A% iA
% of Capitalizationpear endi Operating Revenues (000) $1.7P 939 $ 1,740 a66 (0.4)
Operating Expenses (000) $1,498,533 $ 1 A9, At>6 0.1 Netincome (000) _
$ 146,144 $ 18"' (1.8)
Construction Expenditures (000) $ 261,221 % 17.A18 49.8 Gross Plant investment l000) $4,038,771 $3,8' 5.283 5.6 Number of Employees 6,611 -
' ca 36 10.41 Common Stock Shareholders 5f,945 56.075 to 2)
Comraon Stock Shares 54,320 52.807 2.9 _putstanding(000) _ . pperations _ _ . _ _ _ _ Electric Revenues (000) $1,145,915 $1,130A71 0.6 Kilowatt-Hour 5 ales (Millions.i 20.14H 19,716 2.2 Electric Customers 9')0,633 983,616 07 Gas Revenues (000) $ 561,712 $ 377,282 (2.7) Mcf Deliverie3(000) 210,927 202,203 4.3 H65,399 853,063 1A Cas Custongrs__ _ Earnings and Year EndStock Price Return on Equity Dividends Per Share und Disidend Yleid a LammgsPerShare a Common Ltmk Market Pnce. $ s PSCo o Diudends Paid Per Share a Common $tml Dmdend i ield-% e indust's aserage(1000est i g - m ._.,,.___m,_ U ,
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l l Pnmm inoana moman% measunog . dCtual fetufn Of' $hdFf*h0IOC f quit) } 4 alit. 2 b currently authorized bs rentation.
Eai;tiings/ Dividends 1Public Service Co. earned $ 2.49 per s< hare in 1990, paid : _ common stock dividends of $ 2.00 per share and attained 7 a 14,3 percent return on common equity. Iln November, the conipany began offering an Liectronic Funds Transfer Program to sharebolders currently receiving
- dividends by chec k, T hrough this program, these sharehold- -
- ers can have dividends electronically deposited directly to their bank accountsc naGmce Energy Fort St. Vrain in 1990, the companfs natural gas deliveries grew 4.3 per. Defueling of the fort St. Vrain Nuclear Generating Station cent over the previous year. Thk resuhed in revenues of was initiated in 1989 in preparation for the decommission-
$ 561.7 million on 210.9 billion cubic feet delivered to cus- ing and conversion of the plant to a gas-fired facility. In Janu-tomers. Electricity sales in 1990 grew 2.2 percent over 1989, ary 1991, the company received approval from the Nuclear
- with resulting revenues of $ 1,1 billion, representing sales of Regulatory Commission to change its radiological emer.
20.1 billion kilowatt hours, gency response plan for f ort St. Vrain. The change more accurately reflects the potential for emergency situations Rates: during doeling, decommissioning and repowering activi-On Januar) J1 ; 1991, Public Service Co. filed a rate case des at tW plantinitscent shuMown mok with the Colorado Public Utilities Commission, its first rate in its efforts to k>ok for environmentally preferable ways of filing in nearly eight years The company is seeking to lower repowering Fort St. Vrain Public Service Co, began a joint overall electricity revenues by 0.82 percent and to increase study to determine the possibility of installing a solar pow-ove all natural gas re venues by 4.30 percent. These c hanges cred system at the plant, in conjunction with the planned
- would increase the company's annual revenues by $ 13.4 use of natural gas as a fuel The study will assess both the N
million and bring the company's authorized rate of return resource and economic feasibility of converting a portion on equity to 13.75 percent. It is anticipated that the hearings of the plc.nt to solar. to fix total gas and electric revenues will be completed ate M Mh 99 lbwing unsuccessful negotiations, the company and the Department.of Energy fl!ed complaints against Idaho Governor Cecil Andrus for refusing to allow
- Maliagenient Changes shipment of spent nuclear fuel to the DOE's Idaho National
. BrVant O'Donnell, retit ed director, executive vice president Engineering Eaboratory. in addition, the company has begun and general counsel of PuHic Service Co., passed away Sep- construction on a temporary fuel storage facility at Fort St, tember 1 ; 1990, in 1979, havkg sen ed on the compa ny's Vrain. The facuity may be used to store the plant's spent board of directors since 1972;Mr. O'Donnell became of nuclear fuel ur,til shipment to a DOE facility can begin.
counsel to the law firm of Kelly stansfield & O'Donnell ed loined the company as eucuhve si e president and general AcquisitionOpportunities c'ounsel;He re tired in 1989. In addition, Dan lL McNellis; To meet future energy needs, Public S.ervice Co. is focus.mg
; retired vice president of govemmental and env nonmental affairs passal away September 13,1990. Mr, Mt Nellis "" dtrategyof mvestigating and pursuinginvestment and -
worked for Public Service Co. for 4 i years and retin'd atqwud n ppodunities.Thetompanyispursuingone suchopportunitythroughitsrecentfil gof a reorganintion ' M1986' 's .. planfo nebankruptColorado-UteElectric Associatit,n. Also in.1990, Ralph Sargent lli was named company treas- This proposaliwhic h would enable the company to acquire
- urer, assuming executive management responsibility for -a majority oiColorado.Ute's generation 0nd transmission treasury operations, financial researc h and analysis and assets, was hied icintly with the Oregon based PacifiCorp corporateplanning, in anothe acquisition effort, the company offered to acquire , -In March 1991, Robert T. Person, Jr., vice president of puo' lic the Color ido and Kansas electric properties of Centel Cor- ! affairs, resigned after 20 year > with the company, to establish poration. Althourh this offer prosed unseccessful,the com.
c a consulting prattice in communications and public affairs. pany will tontinm to examit.e viable acquisition N opportunities. 3
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3 s Last year's annua'l report emphasized that the company had embarke'd on a new course to enhance the value of our sharehold-ers' investment.1990 was a year of transition during which we invested in various business opportunities that ; vill enable us to reach our goal of earnings growth at a minimum of onc percent above the average inflation rate, in spite of the many challenges we faced in 1990, we were able to achieve earnings of $ 2.49 per share, which was sornewhat ben er than we anticip 'ed, due pri-marily to higher electric sales and less impact from rate adjustments. n _ . 10 T O X C30 d OTS As we look toward the future, we are taking an aggressive leader-ship role in the energy business and have adopted several strate-gies which we believe will position us for the changes and competition we confront. Because the vast roajority of our business is regulated, the key to achieving our earnings goal is to convince our regulators to use regu!atory principles which provide the neassary incentives for us to optimize results for both our shareholders and our cuatomers. In that regard, we reached an agreement with the Colorado Public Utilities Commission during 1990 to file a rate case in January 1991. This case, which requests a $ 13.4 million increase in the com-
)any's annual revenues, is our first since 1983. Our approach is 3ased upon the regulatory principles and incentives we believ are appropriate for the business environment and challenges we r face in 1991 and beyond.
We continued our endeavors to improve earnings through promoting growth in our existing market > and acquiring new , ones. We launched a newly invigorated marketing and sales pro-gram focused on understanding and meeting every facet of the energy needs of our customers, and continued to pursue acauisi-tion opportunities in our core gas and electric businesses. In that regard, we made an offer to acquire the Colorado and Kansas electric properties of Centel Corporation, which proved unsur-cessful. Our efforts to acquire a major part of the electric gener at-
;ng and transmission system of the bankrupt Colorado-Ute n,e w,.,na.wm n"
Electric Association moved a step closer to fruition when early in
$l2$$$hm 1991 we were joined by PacifiCorp of Portland, Oregon, in sub-
' .C$f2$$e J
<mnen mitting a comprehensive reorganization plan to the bankruptcy court. Confirmation of a final plan is expected by July at 1991, i
5
The pursuit of opportunities on the gas side of our business played a vital role in our growth strategy. T h~ rough our subsidiaries, Fuelco and WestGas, we initiated significant new coal seam gas drilling, gathering and processing projects in the San Juan Basin of south-western Colorado. WestGas also gained access to growing Midwest markets through the purchase of an existing pipeline in northeastern Colorado, and progress continued on the TransColorado Gas Transmission joint venture project to build a pipeline to transport western Colorado gas to the West Coast and Midwest markets. We also formed another joint venture-Natural fuels Corporation-to build the infrastructure and develop the market for compressed natural gas as a transportation fuel for fleet vehicles. Most of our investment in the electric segment of our business was in transmission and distribution additions to serve load growth and the inAllation of state-of the art environmental control sys-tems at our major power plants. It is significant to note that all of our power plants comply with the new sulfur dioxide emission
- standards of the recently amended Clean Air Act.Moreover,we L were the only company in the western United States selected to
- participate in two projects in the Department of Energy's Clean
- Coal ill program to enhance environmental technology.
- in 1990, the Colorado Public Utilities Commission approved our f electric demand side management program which will reduce peak demand on our electric system by 100 megawatts. The pro-gram includes provisions wHch will enable the company to recover its costs and earn a ieturn on demand side investments.
The defueling of the Fort St. Vrain nuclear plant was initiated late i e in 1989 in preparation for the decommissioning and conversion of the plant. Unfortunately, we were unable to continue the defuel-ing process beyond early February 1990 when the Governor of Idaho refused to permit shipments of the fuel to the Department of Energy facility in his state, For the balance of the year, we contin-ued to work with the DOE to resolve the Governor's objections.
- Even though all substantive issues have been satisfactorily l addressed, the Governor continues to withhold approval for ship-L ment, which forced the company and the DOE to file separate I complaints in Federal District Court to obtain a court order authorizing the shipment- / care confident that we will ulti-mately prevail in this matter. However, in order to be certain that the defueling of the plant can be completed by no later than July 1992, we are proceeding with construction of an on site storage facility.
6
l During 1990, we made the decision to pursue the early disman-tiement approach for decommissioning the plant and a plan for proceeding on that basis was filed with the Nuclear Regulatory Commission. Should early dismantlement not prove feasible because we are unable to obtain necessary regulatory authoriza-tion, SAFSTOR decommissioning would still be viable. In either event, we intend to convert the plant to a 330 megawatt gas fired unit to be operational by 199S, and are studying the feasibility of incorporating solar technology in this project. As we consider the critical issues before us, it is important to remember that more than ever before our peo ale-our energy force-are the difference between success anc failure. One of our major efforts in 1990 was the implementation of our Service
- Excellence program in every organizational unit in the company.
This program is driven by the basic concept that every employee serves customers and that people who are empowered to do their jobs in the best way possible will respond with performance which ensures that the company will reach its financial and other corpo-rate goals. The challenges ahead for our company require visionary leader-ship and we are relying upon our Executive Policy and Strategy Group to set the course leading to enhancement of shareholder value. The views and insights of this executive group are shared in the following pages. As reflected on the cover of this report. Public Service Company of Colorado is an energetic, pro active company.We are the peo-pie coming to work before the sun comes up. . .the linemen mak-ing repairs in a hailstorm...the gas service people relighting pilot lights in the early hours of the morning...the managers holding strategic planning sessions on weekends...the team that shares the work and rewards of providing energy to our customers. We are a company with a proud history and a promising future, t
/
4M D.D Hock Chairman, Wesident and Chit ( hecutn e ofister Pubhc Seruc e Company of Colorado 7
~ . -. -
l l ( I j i 1 i 5 ' l t w v w.,u Sum u uth tutting habhr Ao reu n Co 3 "vwonton e"can be r i m lun e d< vah y a dr rianut le ruler sha;> to an o < omnuned to l l um oh vie as em;> on rA in as Jash de < t uom A thm on ch snuir!- l Arandsvr' of h, *n e m h e uti do n o i art s o'Ur Iburt to thr < a"'luiH> ' Am s O s - t ouis's d u nh a trratt Vu al'p'mh h H AIc'hd'!d YubIir i Sers u e Co so m hitu its ub.u ctor q!at Irast Ipen a m n ul 1 1 eron th on e anuno lici, w nu nibe ! \ s 't the Sr'not umHarr"H n!It's. <ad H 'o"H Atrarrgis n ua 1 Othhh n it M h dutis"M tha? H IIIt Ua o Yubbi l htTs h r ( Y. t *l( sr ltilads' u ' u \t' th! \ *H'M ('{'ridrHle IN UN % T ) tt'
- nu et a vu v eum natomer on t ds arulenharu c sh.at ho!Jrr solur.
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i Arnior Firr Prrddent. We reah/e that our sut ( eu (ompans k msohed in toc ih the plant reneratn. Caittomera A pends on the su(( eu of three maior ge industr) Wowmeth-ceu, ras ov,( vuom- hv -~ ~d v< " o" . "' h"'"l
~ "'"d "S-'"""t" I
and ieahte our vhion onh transndmon and distnhu- I" D"""" (lur emploWW tet ogno g,gjgy y'm th omo%'en e.d d our(ustomen know that om of he need to be ( u" w ele meettng their energs I ' d & t( W t e m b & tomer dnven n ill keep us vean im f or esample.we nec(k in w as s that demon- M 4 oht ue(m ( ompehus e and enable , ye a pau min. peer M! ate red s alue' And to " us te prosper u the utilth s m a pro,e i that w dl(11en better roert their need* " mduurg goes through f un- up adWhonal ge tramnw AI hm~Malace ** b E' '"" b "" " "" d"d ' " '"'" I h" ~ ,' w e hemom/c our enods th-oughout the Uruted g.%.. - _u-en- da, s,a,eundmch buh l .
. n ith a ( omenet ahon plant hsh on the f uture gtowth w that c ornmen( ed opera-potenhal of out program to tions in 1Onp A short-
\
dn elop a market f or the ughted soluhon u ould use of natural gM M a
.a has e been to uniph por- s chit ular f uel. T here s no e f-i see ine now e. nu.a nenoen tn-und e,.
produ( ed. Instead, a e egs and inwh ed emplos - i . . N L . adopted a ( euomer ser. ees ( an enham e our s il e strategs thalenallled ahibh t(Itargelpoditable w e're edut ating and empon - damentalt hange.Where
. . to benefit our i. hate- new markets m the natural ering our emplo)en and it stdlmists aell(onlinue holden and our ( v40mek equipping them to f ormu- to benent from the bask
& husineu n e knit the ppehne that I late innovatn e solutions to so( ial( ontra( t that pro-transpo r ts naturalgas tothe l'atrick W. McCurter theenergs demands of out te( h our terntors in plant, w e supply a sigmh- Srnior Firr ferddont, rnidential, busineu and eu hange to' out ohhga- llIrrtric Optrationi
( ant portion of the fuel, induunal r ustomers. tion to sen c. Where the ( ontrat t has eroded, w e M Md"b *#"# u " Rather than simpi) tespond-- i d diSU U'" U SN'""h "h \""k' Ing to ( uMOmer pn thEfTM , g ing lot wa)s to at he e our or mquinn our saln peo'
- g ( orporah' goak through our ( uuomers and proude 2 ple are seizing the imha. hWol mangement d 1 m with new energs ."
live. he re of tennM our our recurc es. In [le( tric ophons. t ustomers ( ost was ing ()perations, we deter m med strategies that make real ( pital spending prionhes
,, g ,, W d e sense to homeow nem and Acidor Firr Prnident, through a dat iphned pn n help businesses prosper Uni Operationi ( ew that enabled us to tom and groo. In the long run, our proposed In9 I hudget it's this approac h Ihat w ill D" O"" U dd '"b hv more than % pert ent.
int rease our markeh and about hiu been ernina( ed bs our Ga(Operations # I y, Paen W w trin 1 l
um k n ( ono mg.edre te( hrailogies clso u ( eu in addressmg a 6 es i has prompted us taiesplote asue during l'WO-the as a semot managenwnt the pumhihh or int upo- allo: ahon of tesourt et In group. have done a sohd ratmg a so!ar enem ( apa- our t Wl planrung( u le, job of des < nbingout cam- bihh intoour iort 5t Vram w e est a bhshed wr porate ings vision. Ilut the bue m plant, as we(arr3 out our ( apital and expenw kn uts by our emplos ces traut etioris tu t ora er t the p! ant and( aref ulb aHot ated (la kul w hen w e wndut ted to a naet o ed iat ihtt Our resoun es hawd on the dis < uwion seuions through. tmt priunhet of ( ourse. strategh needs of cat h out the ( ompant I ha inter. are to sut ( enfully detuel malur organgahon at tion set the stage for and det ommimon the \\,e tulh re(ognitelhat tha a trub partn ipatmy work pla nt. llu' t he ( h.dlenge of aM(K ation prot ew must This same strategy should environnwnt that gives a!! mt luchng a sola upabihty t orna m fle u ble, how es er, ahow us to rueet the gum . of us.whate a our Kibs. has sparked new enthusi-and that u e must he pre-ing ele ( trit ity needs of our a knowledge of hia, we asm among our engmeeri-pared to shif t our resoun es ( ustome% os er the hest impac t the bottom kne. and te( hnic iant det ade w ithout buildmg ng Ihis new wayof thmkmgis
- NW W espendre new generation.
We are cratting a plan to # " "' P * ""d I " "" ' " #" ' e . nutn wnMo the ( ommunity ql4 balan( cour future needs through esisting ( ontrac ts 0 * "" to pun haw regional "*"*" b" "O ', cu ess c apac ity, through N""U d "' "* a the pun haw of power chods at our Wrokee - from non-uhf to genera- U"" " P' d "l * """ g tors, through the ( onveo hau* w OM s law PoM Ho redu nulphuo sion of our Fort 5t vrain
" "" " """ ~
nuc lear plant, through demand side managenent U'" inh U"" Indeed, the posit c effec ts >o the most attra( th e carn-
" U"""'""P "d"Y progtanw to reduc e our of the ( ompam 's Se% it e mgwpportumties peak demand grow th end eHonuhat have #ow ed u* i u cuen( e appmac h on to take a leading role in the Our key ob in in e has been through taking ads antage o. ur work eth.K , on the haf tle for ( lean air' 11 is to mos e an av from simply of a(quaition opportum.' rnorale and perfuman( e rew atding to see that our keeping trat k of our fman-ties. W,e also are uthing a o(our emplos ces and on programs to redut e pow er ( ial resoun es and to com.
new program to estend the - the grow th ot a new spirit Islanteminionsand Ino. ruunic ate to eat h ( ompany life of our tunent steam with.mthe(ompan) have plants.
'" Pd" U"H"H"diutal produc ed manv tangible 9"""""
standmgof how it wntrib. gas vehicles and iaeplac es msulh We are very (onfident that are being re(ognited by utes to the profitahiht3 of tha new approach to rueet- a nost of communities ()ne good example ( an the w hole (ompany. T his ing future regional electric - throughout Colorado. be fou nd in our employees' w ill ensure that eat h ity needs w iH duetfly etioris to a< hies e and spending and im estment beneht our c ustomers, as A. Clegg Cru fntd eu eed performanc e ta r. det ision mos es us a step u eH as positiveh impact rice President, gets a hk h produc ed a ( lowr to our earnings goal. tolorado's economic Nuclear Operatioin savings of rnore than $ 3
. . Au ountability ,s tbe key.
des elopment efforts for milhonin ty90. And tha g Our mmmitment to the years to ( ome, "'""""" "'A'"" environment and to lead. know you are au ountable, do a better job oiconunu-the purpose and vision of James R. McCotter g aungar goak and the enterprise bec ome
'mp'"VmV our Wrvn e.
Senior Vict Prryident, z gy, mgy, Corporate Affa rs both inside and outside the amIRrwurces Mnphauum wat@ man-c ompany. these suu esses agernent and Sen it e In addition to properly " I U h""""d * """" ~ l u cuenc e this ewc utive managing our resoun es. team n sending a clear sig-Richard L,. Kelk we wig ( onlinue to te;y gg pg. p g. nal that ever) emplosee on Servic e [ stedence as f inace ed da nion affet ts the perform-a vital toolin helpmg us Chir //'inar.ciaIUfficer aru e of the unr poration meet the needs of our ( us-tomers and realire our * "#"NM earnings goal. I think n e, '" +dd ""#U""" Al Acim (nnamu o d __ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _
( ontantung the f(K us on unt- a efic(tne o;wrotiora l'obtg ,, Servu e t o. ses yrt d a le.it on a new usywratc headquarters . im thig to take .chanuge o' Ntrm tivt Deinet vt a! est.'te f ales and to ruert th( u.niponn perwn; arxl ,, *,. . , tulare needs r'xve eltu senth. ,
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O _ Coloradoi role as a maiot tranyvirtat an and trar.le u nter ., t ontinut*' to espa nd as ( onstrut - - tion pu eeds on the new Denver aiqut. 4 4 IO , . ,.. = o
3 g, m .~n Lll O B W O 5 Publir Servicr Co of C Jorado% new stratrguc vntem anda trvp Colowdo Uptitltistit tali:rd ernldmer spir I are driving the chans;rs necenaryfor the g , g g g 93, , r(vryiany to a< hirer its goalo/increastng us carning3 by at lea st ( onc erns of rec ession elsewhere in Ihe nation. %e outlook Ipcrt ent morr than thr as truer mflati<nt rate. This g<nd of y , g .. ,g , ,; g 9,4g, g. enhancing the value of the nunpanyfor tmr sharcholder s. u u s- , , , , , tomers and employt es cannot, howes er, be trali:ulthrou ch the , actions of m magementahene. Our " Anh 2 philosophy centen and expanding unmpames from atound th' w orld Our stale's t m a dvtuamc icadcrship tra m commined to in volvin e ctnpim ers ,g g g directly in daily decision making and t< emjohasi:iny the highest em ourage people to move here. An eduv en anare tjuahey scrs ice both in side and <nnside the comynutv. , , ,
,g A "bu sines s a s u sual" approach ha s not bren acceptablefor thns v in Colorado.
Some time at Public Scrs is e Co Dnpfmccs ore < ommined to - C.onstru( tion is under w av at the new Dem er airport, w hit h lookin efor new unys to soh e oldf vobtron andare determined promises to position (.olorado as a major tramportation (en-to h sten closciv to their etoromer, and to be dris en bs their necdv g , . One curntialcom ept that allow 3 us to moir tenurJour Anh 2 geted ior ( ompletion in 199 L Public Servit e Co. has begun rutnings goalis a companion orogo um calledServ ice I;u rh w ork on prouding utal electriuty and natural gas servic e
/Once, [hron Ch Se rs jcr lhcCl#nrrh theme (8[t'mpou cring f WT to Nic energy-interlsis e aviation farihties and Nie f elated nortforu, u c are improvinn ryiciency and the ctuahtutf scrrh c grow th they w ill generate.
providedlo vur dis erse customer groups. In turn. this participa- g , g tory wort em ironment allo.vs ali cmt doy ces to posiin t ly impact g, g gg gg 9 the < ompanys bottern line. Convention Center enjoyed a <.uc ( essful starI in 1990, and Our unified goala ssure s ourfinurr a s thr enrrg; ptm ider bookingu ontinue to surpms its hrst yean espectations. thosen by a dyn.unic t hcngmg marArtplace. I his tac ilit y will( ontinue to play a meaningful tole in the rentalMation of dow ntow n Denver. Additionally the new Cherrs Cieck shopping ( enter has placed Denver on the same r etailing sc ale w ith Ihe largest Amerit an ( ities. Bongmg it all together has e been Denver's progressive vot. J w ho have stepped up to the plate and made determined ( ommit ments to the future. In addition to the rnoney ear-marked f or the new Dens er airport, they has e passed several impor ta nt infrastruc tore bond issues totahng more than 54 30 million in the past two s ear s. Voters also endorsed a plan to ( onstruct a new baseball stadium in the area's bid to bring a major league baseball team to Coknado. Public Servic e Co. is maintaining its commitment to sen-sible et onomic grow th, and manv ot her large ( orporations have joined our efforts to stimulate des elopment throughout the state. l n
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4 Meeting ( ustomer necch and esparuhng our businesso go g l hand in hand w ith helping to t rt are an environment that w ill y ] j (onlinue to attra( l people seat c hing tur a quahl) Inest)le. l Our efforts base been f(n used in three pomarg areae l redut ing pow er plant emiwions, buildirm suppott for aher- g ! naute s chi (le fueb and natural gau chic les aral promohng f the use of t lean hu ning natural gas logs and fueplat es lhe l (ompany also rec entl) adophsl an em ironmental polu s u bic h ( ommit s us to go hes und n hat is lega h r r equ ned to l redut e the impact of our operations on the enuronment. I 1
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l , b l we are a lcadenn the quedor deaner Comnus .m and ee we h me aumpnng to se adwmt.e.onhe mmu deepienvo u nna - siodnomso w omeo,m m emd demanduo, dean <eci m iihihe o,,e m hono<d,esvn. questions about the sewndary soun es of Dem er's Bn m n hvtet h proje( t bs I uelot our gas and od e .ploratnin and Cloud. An eat her air quahty study show ed Pubhc Sen u e development subsnharo 5s ohytec h is being hmh at a con ontribution to priman soun es to be insignihtant. Pueblo, Colo., la ndull aru hull produc e ( lean wot hetic diesel' jel and other rnar ketahic orudut Is irom the rm thane Our efforts are pay ing of f, and w e s alue our quarter hilhon-gas ( reated by the dec as mg carhage Putong this naste gas dollar ins estment in environinental prOte( tion equipment to a pe nita e use aho w dl help tedtn e landhli( ontributions and pow er plant (ontrols, w h.u h La ludes state of ahe art to the ~creenhouse,.mnc ern. Produt non at the plant .a partic ulate removing baghouses on nine oiour generahng expe( ted to begin later in i mil uniK. We has e( onstrut ted the largest full s( ale projer t of its kind to eeduc e sulphur dioside emiwions at our Cherokee l hese chorb to keep our em imnmeni dean a ho e epresent ptm er plant. We have demonstrated that w e ( an ieduc e substantial cammas opponunnies for Pubhc Sen it e Co., these emiwions by 50 per( ent, w hic h w ill forther minimac and w e are idealk posihoned to meet gron inn mar Let , their impac t on the environment. in addition, the ( ompany demands. is involved in ta o proje( ts under the Department of [ nergs 's An addihonal oppor tunit) ( an he f ound m the str a t anti-Clean Coal lec hnology lll program.1 hese programs are
. a ood- hurning onhnanc es in enet t in D. era er and mans designed to at hieve signif a ant redu( tions in suk,ur dioxide,
. . , ot her (.olorado t ities. Our program to enmurage residen.
nitrogen oxide and carbon dioude emissions. tiah ustomers to mou .t then wood-borning iuepim es to Allof our pow er planh( urrently meet the emiuions equne, natural gas benents both Pubin Serva e Co. and the prhtine menhof the re(ently amended federalClean Air At t.While Colorado environment, other utihties need to add espensis e ( ontrol equipment to then. generating facd. ities, w e ah eadn omply w .it h the suhur
\\.e are at hies ing eu ellent results n ith out natural gas log and tireplac e marketing program. As(ities throughout the dioxide emissions les els sel for Me y eat 1000.
( ounits begin adophng an.quahty restrk tiorn and hud, ders in a len traditional area, our c c.mn ntment to the natural gas respond to c onsumeri demands for mom envimnmentally vehic ular transportation busines, represena obvious oppor- ( ompatible homes, w e are sclhng our marketmg appmat h c tunihes to int rease natur al gas sales. During 1 W0. the ( om. to other utihties as n ell. pany enter ed into the $ 100.hillion annual transportation g j g, fuck market through the formation of Natural luels Corp a 4 ,
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,,g gg Joint s enture w ith Coiorado lnterstate Gas Lo. and Julander Platt Nelson, Inc. of Dem er. Natural f uels ofiers fleet opera. &n@ mMWm WuNm immwd tors a viable alternative to gasohne-compressed natural gas, d hWom owMme WM M'oba %W Nm n&nMoM o@ d Mh meogmmmw w hich a the deanest burning, and most et onomic al and idom ewbwe odshmnpo m e.pimhnmonn domestically abundant tra nsportation fuel available today.
O nd -d b On in nowf PAN M n du a 1 This new s entore opened ib first commen ial natural gas the 1%0 Clean Air Colorado Co Pannet ofIhe icar by the , s chide conversion and servit e ( enter in June 1 %0. In addo Colorado Department on lealth. tion, NaturalI uek joined fort es w ith Amoc o Oil to operate ! natural gas fuehng facihties di several AnMK o gasoline sta- ' lions along Colorado's I runt Range. NaturalI uch expech to move into new markets in other states in the next few years, 12
Natueal ps focimg f at il+es et sevetal Amor o psobrie 59tuins along Colo'a&n f 'ont R ange in one clrment ol1Ne o,f r astrut tute-tiuyd,ng ehott bg Natural f uels
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k w ygf r wa;m.a. w- ,,:: m, 3;,- .7' '. .ip q q. ; lu Sph,. ,, g T he largest full 4(ale prolect of its kind to reduc e sulfu' Soude emmions at the (ompanig Cher. okee power plant has suc(essfully I reduced emissions bg 50 percent, further minimaing enuronmen. tal impaC'. 13
l , , (if the IM'ht (Iol allt tf 4 (ofhlbah)~
%ill f t'!) Oh O ) $tle!\ 05M4lf(e% to meet the gma t'ir tient.if gl for ela trnitg Pit tured n the(om-inv $ netic t tmtve w hete its t'le(tfit it) LUppl %%f atty) h(af-i fit'(i OVi oh a (lai!iIsabl%
y 9, 'k _ _ Ihi$ in ently t umpk le d inter ( on. net t:(in pr6yec t in nonho ints sti Coloratiu hai nir,fittn antig .> trg teami the atuognt of natwat g,is th.h the (ompany ( an ex;xirt to pow ing Mittw es' ma'kets. s lFi h)Vt hW t'4lef n (o!of ado, WestGas hauua esdully expanciedits ArkansastoopGas Pr(< essing fat ihn to pther a'id pfo( e%b tilofe fidtdf a! peh f0f tieliver, tointerstate pipelines. 14
l l Rtural Gas: . m Avemic 01 Gtowth Stt alepic Cout se Ior Hectt ie Opci ations l' We rt main comnutted to our it aditiotjal natural gas supply We ( ontinue to ( ont entrate on out ( ore t nm ne% in i in it k busintws As another as enue kiw afd our earnings goal, ()perationt We do not anht ipate the need to build .mv new w eie explored ses erai non-tr aditinnal ate.n that ore ( loseh pow er plank during tha cic( ade. Rathet. Io rneet f uture ein - ticci to this c ore buunen. We ein ision, f or example dgmii. trK il( needs, we n ill rch primarik on edsting( On! rat tslot ( ant earnings potential in the tranuniulon of natural gas to en eu( apat ih a oat recon.on non-utihts genetators of mvkets outUde the Ro( ks Mountain region. 'fod.m the a nn h apptodmatch Mp megawatts ate under ( ontiat t.on Roc k3 Mountain tegnin u pphn approsunatch 8 pen ent the p!anned natural gau om ersuin of hot St Yram, and on of the gas tequirements of the( onlinental United 5tafet yet s enous awet at qu Nhon opportumties it has apprOsimMely 1 u pen ont of the pros en natural gas Ad(ht,onal4 w e has e ( omnutted to a s anety of ' demand reserves and more than .'6 pen ent of the probable gas . ude managernent" props is deurned to reduc e th(wowth o . . UlNNgyISRSS e.__ ,_. . , _ _ , _ , _ , _ t7 7n1 n nnedieuee,. hum na,o,,s.,d u, ,,n,,,,,,,,, . ,,,, ,, u _ , ,
*" # ""I '"b" C l Mk tntune-ti ntr me - m oumunp m "*,nimd,"h u se,,"s meed,o hudd or puu hase expensk e new generating c apac ity Out A(entral objet tive of our WestGas subsid;ars is to plas a MHanO& rnananenmot promam. one of the nadon s dirMt role in hudding the pipeline mirastrut ture that n ill largest- w ill reduc e mcreasedo out peak demand grovvth mos e Roc ky Mountain region natural gas ouhie our Pado h %rnNwaHe 14% or mughh enoughHWth(Ity tional servK e crea. This cHort has led to the ueation of TramColorado Gas 1ransmiwion, a joint s enture w ith kN I""#d N* "C"N d '"'UnmnitY of I UOM O people.
to I mher.the Colorano Pubht Uhhties commnsion i nergs loce and Questar py ieline Cos in w edern Cdorado.
' ' n ed the program and pn a ided a ma hanism that
,ihk wnture involves the(onymuion of a 3 m.mik%ie-
" "d"""""'h 'U("v0' the ui4 of our demand ude hoe through w estern Colorado to Danspot t natur al gas to the growir'g Cahiornia and Mida est marLeh. "Ja na gement im estments. but in pmfit h om our enorg If thn meet a sut(eu(ritenonestabhshed hs theCpUC.
We ako ret ently expanded our transmiwion system in ()ur strategi( approat h and determined etiorts to he innos a-northeadem Colorado thmugh the purc hase of a pipehne th e has e spawned a new pmgram to estend the hic or out that ( onnn 13 the Derwer lulesburg Basin to the Wihiams steam pow et plants. a hic h w ere hm.h to last appmumately Natural G.as t.o and .Trad, hiater pipehnes.T his pipehne n s-tem a ih enhan( e WestGas' abihty to sen e the %da eu ga( . "" , "" " """ U *' 7 " " "" " """"" and I nhan( ement pmgram. w e have found that w m an market as well as provide additional supply options f or i runt
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than new ( omtru( tion-through detaded inspa tions and Another npansion is undern av at WestGav Ar kansas i oop modif a atiom and, in some( ases, the installation of replac e. Gas proceuing fac ihty in southw euern Colorado, w hit h ment ( omponentt gathers and prot esses gas in the han tuan itasin for deln ers joined tegether, these strategies enable o to interstate pipelinn. .T hh expansion project is inc reasing our f aahty *,(apacit) by 30 million cub.ic feet per dat offer some of the lowest s electhe0it u rates m.' to( onhnue nahon, With the Roi ky Mountain region.s abundant natural gas As w e look forther into the f uture to demmune how w e best tesoun es, we'se in the right pla( e at the right time. And, Cob
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orado and our neighbonng cates have neady half of Ameri- * '"" D " "" " """ U "" " U"" "
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to a strategy of pow er plant im estment (a s c oal seam methane tewrves With nen drilhnn and rompletion tu hootogies, our f uelc o subsidiarv is able to An example of this strategin hange can he seen in our reor-produc e gas trapped in these large (oal deposits. During ganization plan for the bankrupt Colorado-Ute Ileceit 1990,Iuekopartiapatedin thedrillingof approximately Awociation. Ihe proposal, filed jointh w ith the Oregon-45 c oal seam w ells, the maiority of whk h are in Colorado's based pat ifiCorp on i ehroary 22, I n4 I a alk for pubhc Ser-San tuan Hasin. vic eCo toac quire 606 megawatts of ein trk genetahng Although our primars fo( us remains on the traditional busi-capa appmunatch 1 M mb of Uansnyon fac h new oi providmg natural gas to an npanding t ustomer base """""*""' """*""'""I""" "# " "' P ""
- throughout Colorado, these new efforts and an entrepreneu-
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As a result of our Service bcellence propam, our customers Recubtor y lim uonnwnl sense a new openness and willingness to adapt to dynamic . .
""*""Y',,, ' "D situations. it is abundantly clear that by having a thorough been a c ompelling motivator, to !ook for profit opportumlies know ledge of our customers and estabhsning stronger (om- W dhe hW%
munications with them, wt ( an be more suu essful in pro' m m edu hwmmnW mm-viding the mostenetgy efficientaost effective solutions to ing the regulaton enuronment of our wre business.We ret-their c hangirg energy needs. d o bh m obtain and earn an apptopnate rate of return and to haw ont pric es ieflect appropriate regula- N Our Marketing and 5 ales organizauons bas e capaalized on new opportunities that go well bevor d our traditional tors print iples is paramount to meeting our aggressa e earn-relationships through inc reased cuvomer , mderstanding and ine goal. a flexible marketing approach. Analyzing the energy and Odmn H , M , hmpdW W w MW transportation requirernents of a grotet 7-(aain as an inte- ggg ggjg , , g g grated enterpilse instead of a series of individual stores has mmmission allow us to det rcase overall elet to. ti :h ( ush b3 enabled ustopropeu in mnversion of thecham, ,svehicle OM. peu em and tu inucase owrall natural gas msts by fleet to compressed nau al gas and to suggest w avs to L3p enent.Thisattionfollowedthe fdingof a(omplamt ~ inc rease the officiency of its proc essing plant oper ations; %,e case by the Offic e of Consumer Counsel alleging owt earn-also are studying the conversion of a Colorado ski resort s ings and related negotiations w ith the commission'utafi main powe, sour (es for ski hits and snow making equip ~ T hem hanges w ould inuease the mmpany's annual t eve-ment from electricity to natural gat w hic h w ould elinunate ""
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the need to add expensive new capac ity to the electric sub- rized rate of retum on equity io 13 75 percent.We amkipate . station serving the area. date hearings end related proc ess w ill be ( ompleted in Another illustration of our responsiveness to customer needs late 1 % 1, oc c urred w ben one of our major c ustomers, a refinery in OWAdmW immym ediew h W m' Denver, began looking at alternatives to purcha* - le( tric. in nearly eight s ears-indodes a quahtatiw approac h th it i.tyfromus.W etookthe. .tiatyeanddevelopeda ini strategs to - Mour at tive mmmitment to conservation, thc meet their needs by viewing this c hallenge from their per- enWonnwnt and thnornnmnme a m e, and urg, mat spective. We decided to teloc ate a combustion turbine, these efforts be mnsidered by the ( ommission in renhing which was no longer needed, f rom the Grand lunction area tothe refinery and add a systern to provide w aste heat for use
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in the refining procest This careful and ( reative planning P#"Y * " "' N * "'" " #
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tomer a competitively priced product while utilizing an existing asset, rather than buyhn, new equipment. This orogressiw conc ept of sharing the fruiu of a mmpany's We are finahling a new c ompensation system that will fur-
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ties that benefit our customers and aho contribute to coq o rate profitability. T he importance of this compensation program
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is measured by its abilit y to get us doser to our customers P""" Y "' "YP" and to better understand their neecls. Their suc( ess is our suc ( ess, n
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w ai= lle(aust tath ,hildhootideneb o;mient propantudter one of the . gre.Jtwt hope for erwunng su(- (t'% in StIRKd. etib 4 bers k e(u. h h fut uung a seongx euon onts empkwtond hnanual upport r)n ths edut ational hted l'ublic Scn is c Co. t osannun to irwle Jun ct n .nti ubunoro. 4 alu ? financhd or vs Aignifit arn u dwaver eth a ts. toproeramulun tcd (n vnatuse our < ommwsitio bt nerplat a tolis c. uori <vn!do Inninat Creatme bencr corovnunwo o yood buww ofor h<blic Service Co.
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During 1990, we modified in the area of early c hud- How w ch our ( ountr3 \\ e ( ontinue to put out our philosophy and hood development. Pubhc (ompetes m the global energy bat k into the ( om-approach to c orporate giv- ServiceCo, nx entl) prn- mar ketplat e of Ihe futute munny through organi/a-ing.We bec ame more vided "ajor support for the w ill be detemuned bs our tions hke the United W ay, focused, more utre( ted DenveUublic Sc hools' ( bildren's educ ation k vdat thc Colorado i nergs and mare strategic in our iamily Resoun e k hools th (onettingpH oos at Assistanc e I oundahon. the effor15 and contributiont Project. T his program an earis age we Iw nese t cague of Uruled I atin for exarnple, we now ( on. emphasites parental we tan help w in the w ar on Amern. an Citizens, the (entrate less on donating to involvement, re( ogniting ilhterat y and pm ertt We Colorado t tistoric al $o( i-individual causes or spe- that c hildren u hose par- has e estabhshed our direo etv. the United Negro cialinterests and more on enh have been at th eh tion and reatiirmed our College f und and rnany signihcant socialissues insolved with their early eff orh and strategy io( re- others that a'e the root causes of learning environment are ate a better future for our critical community prob- f oure succ essfulin later ( ommunitiet l lems. Beginning in 1991, sc hooling. Related ettorts .d I Senkm ihtens wpmwn! w e will comrnit the major include providing servk es the f astest grow mg wn- , portion of our torporate for children and their fami-ment unmai poph contributions and volun- hes in areas such as menta teer resourc es to two tar- health, nutrition. parenting U""'OCVd)""*dR'""P - geted program areas-early and job placement, as w ell n how wma nw& and childhood development as recreation programs I"" U ""*d " "I'"" " "" ' and academic enri( hment I""k """'"h"'" and senior titizens. activitiesoutsideof the wnkad>m eats o and f schoolenvironment. om in tM,ern er meno g, , area alone w dlin( reaw by 80 pen ent hv 2010. # - 6 ,
Fobow ing our tradition of ,
p .. , i making a ditief en( e in our l ^ c ommunities, Pubik Servic e Co is foc using on The onvanvu onnumenuo ways to enric h the lis es t he " *m"" *"' " * " * ' ""' of our seniors. *"*'"*"h""""",""", enunm oeu%pmen enon Ibn enhavof heIpnl t frate the lbuldet let hn< dogs ! uhator. Hurwtredud Pubhc Serde CO. o hn h prouda o inagement wr, employees and their frmhen uh . ut n ond re%rt n f o rte( hno-
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unt( !r theer brne a'wla c ying logig ath .hamista*t tio Spint10 deln er -sture the % vmth" .y , I,ummn PR tun d is a new baskets to senior (itgens T he .
. . in hno!nn (knekuniin Sunase t%sent e of the program han been .# solahoatings on the mside ud n a oh s hn-den tubn cvipyn 18
i [ Sgm:.,p3epggg- ~ a The utility industry is changing We believe that simply to change with it will not be enough Io achieve our ambitious earnings goals. We must set the pace by responding quickly to the market-i _ place, utilizing the full potential of our work force and anticipat-ing the needs of otir customers-before their demands are met by ourcompetition. l 1990 was the year that " Path 2" came into focus for our employ- . i ees, and in 1991 and beyond our customers and shareholders will realize the benefits. We're making the transition through team'. . work and a 121 year heritage of serving the people of Colorado whh integrity, dedication and ingenuity, , P 9 'l 1 w i_..-- .._,. ....,...,-,~~.,.-.-,_..,,..-..__,._,,..,...-,,_._-.._,-,__-...._.-.._._..-.=_;____.__.
I i 1 OPERATING STKnSTICS ' h Nic kwice Canputy t) Color ado wed hulsiduo an i il Natural Gun Sofde Stathtlo j 1990 pino pene 14r 1460 ions viho ' i Ikf cailmerks 210.9 Ja2 2 194 *i 1% i 176 ' 141 4 2ni 3 i I
% Change _ 4,3 ei 4.0 6 ', 17 Fw ; t to i4 f A, Custunwrst0(Mit hhS.4 t'; i 1 t 4I 4 0 12 O 110
- 794 6 bhlb
% C h.ingt-l.44 1.4 11 13 32 30 34%
Astrage Annualkesidential Mcf L'sare 112,0 112
- Ii6 3 104 '. 10% t, 120 4 140.1
..% Charte ... .
t 0.6i% i, i l t 6.2 L* ( 12.1, !b th (10% i Annuallitatingliegm tlap - $,W Une 5 458 5 4 y, Wl 635 SM 0
%ChAhge 44,01% (2.51 96 22 ilh 41 $ 2) s9 hi%
A's trage Raidential ketenue IVr Mcf %,1.* 8 3 FI i02 1 68 4 Il 4 19 $2 70 I jbChanpc th.hi% (O J i fi 3! tb 1i fI di i4 11 29 0 % Average AnnualliettoutlYt RnidentialCustomer 4420 4 't D 44! $ 4 'tb 505 6 i?B O
% Chaf t/P (2.314 (2.Io 3.6 12 * (1.41) (lO h! 15 4 %
1,777 1.593 1.51? ! 4'l I ..ib l 1.4 U 1 425 1t113 Anellabillt).dl}ldt , Musimum iVak limy n.etuluut &l% h 1,$77 ) 44' i 170 im I .On0 tyh 1,246
% Change ),2 % U4 64 1.1 h4 t) i2 (n 40%
Electric Senice Sintistics INI Utta 148k Dan' I4bb DM 1460 Klipunitilout halp hnlll5unu 20,14h 19,716 14.1 u 4 } gj5 ? l ?328' 17j i5 } $, pj4 )
% Chanvr ,
2.2 % ?? 46 y4 22 1. t Lb% Custonwr610001 WL6 48) b 974 0 % 7.1 MbO 441.4 B203 I
% Change 0,74 1.0 07 09 1.h 2.4 Li%
~
Attruge AnnualHethlentialhwhlinge 6.443 b 146 6.401 b250 6.152 ADO . ,0 7
% Change , l.f % t0 9; 2) 1,7 in L 10 bi 04%
Attrage Hnlaential ketenue lVt Kw h 7,024' ? 11 7 I ts 116 ? .J .) _ 7,14 si 12g
% Change 41,31% II ,0i <2 0i JJ 2' 22 2 %
k e$ age nnualketenue IYr HenidentialCustomer 44!3 451 abo 449 45) 445 $304
% Chang 11. 4 % l2 01 23 (0.4 ) 1J 21 22 1 %
Net 1 ffecthe Capahllit3 at
'Ilnw ofl'eak-Megawatts 4,32h w i 3.4 t ?M Lollat 3.b?Jm Lbitm 14VM 3 0?2(o
- het f irm hntem l'euk lwut lMw ) 3,5N9 3 464 1A2 3246 3217 3 024 2,? 7b
.%.Cha.nge. _ _ . . - , . , _
3.0 % lb i4 iM 'A 26 31% Reserte Margin allime nfIYuk 20,6 4 12 J1 1bJ 11 3 12,5 TOM 10 7 % Getwrathmb3 Clawof f ueh ' Coal 9N.3 % 42 9 91.I Si4.6 96 1 98 8 7b 1% NaturalCnu l .6 % 24 13 36 1.3 LO ! ?.8% 00 0.14 0.2 01 01 0.1 G2 00% Nurkar. . 4.0 53 1.5 0. 5 53%
- teragYbmtIVr L nitofINeb coa-mn $21.44 2i ai 2n9 2s m a is 2i 64 us ei
%tuv4l cam kt S 2.07 2 l' 29 2.19 2 64 338 $ 2.b6 Oib.tlarrel $27,83 30 2h 05 JJ.82 24 41 32 76 526 17 ENtagei5:elCust ivr M(lllTl' 'S 1,17 1,17 IJ5 1.34 130 1.20 5_ 129 w wmmenieati%l w wintet peak INid
}
I i i 20 3 1
FINANCIAL AND STATISTK'AL DATA htblw ,Wr rit r Cornpany el Colorasia suhl Sulnitlwrit' A Mim s ( >#m i u ept .a Nmeth IWO 10! a 14 h!. lWP lobb 14M 14h0 Opts ating Rotnun! liet e n ll,lat 4 I t U8 i i 110 n I U M 'i 1.9
- 6 1: JJ t $ bad ?
G,w 46),7 5' i wi4 wti %0 # 14 i ' ?) 4 , Other 26.3 Jio Jlo th i 1;~ 10 o I J (I lutal kotnues $ 1,1314 f .' 4 a ' i'a4 IMa !.C'" '4'% 11.1 % 6 lt%me litfore I siruntdinar) lle m stul( umulathe I.flect nhi Cha?q:e in Annunting %letimd % l Aft i 14h C IJ>a 141
- IJlC 1)U' i b; O ITtraordinar) ltttu - t 01 4 Cumulatite i.ff ect to l'117 of Auruing t nhllied knenues - 24 0 Nrt imome 146,8 14B 6 ili o > 6 JJ 4 110 ' MO l*rtlerted lHildtud lleyultritp tits 12.4 IJ h li h IiJ t;* 10 6 1% 0 f.arnings Aspitahit for ( ommnt %tml $ 114.7 1mJ 11J J lhit 67 44.i l "U O l.arhlngs l'er Shara t lielo'e a spautdman ilem and t uniuiahW e Uci l of a ( hante m at t ounhny tnel%l 5219 J 54 J I4 ! 44 J uh i El $1 OJ l st!antdtnaq ttem
- I O l'
( pnnilaine efiet ilo I 'l O ? Of at ( ruing unbdled enenue+
- 0 %b Total %2,49 ' ;" l 14 10' U16 1 01 $ 14!
lHnIdttHis l'rt Nhatti P,nd $23rd Jm J Ot i J il4 J on i uh $ 1 hh L let laf ed $ 2300 JlO J lM' 2dhI J (Ill .' l U l $ l h) Common him L Shas es Outstanditig: Aerage mii it1626 ;J Wi %J 4U 52 414 % J _ i4 9 ;1 114 36 412 habend(OAD 44,320 52 hd
- il.4;P %) 4U Q Um Q ti1 19.990 lulal Assets U,2M t 045 J 4h4 J 414 J uin J oys $j ja Cominun l .qu61) % 9:4 % 4e i Me ho! 1% $ Mb l* referred him L:
Subieci to mandaton redempuon at par 46 49 ;J 54 0' '9 84 Not subjec t io mandatan iedem;ition 140 140 lati 140 140 lau 143 1.utig lertu tkht kh3 434 411 404 bd 9lb b4a Short lernalturrowings' UV 166 16J 1% 141 11 26 TotalCapitalisation $2.292 2 184 J.15 J 1.10 2.0 54 J.M0 51?s1 Capitallantion Ratim-itur.l.nd: Comnu m equin 42.0% 41 4 40 2 w ft vi 4 466 0.5% Preteneditm k docl duewithm t u i 10 % 88 90 41 10 % i10 11 1 % long termdebt (loci due withm i vr ) 40.4 % 4J 6 44 ' 4J J 41 " 45 t 4h W Notes pa)able and t omme!( ia! paper 9.3% 7I 01 64 *4 DI O5% Construction lapenditures $261.2 174 4 162 6 I J '.6
. IM7 2 l' % lib! 6 N ollotal t apitahubon 11.4 % Bo ?6 59 L6 11 ; 1 % 0%
Cash Generated internall)" $174 6 I ?! 1 192 h 47.4 110 6 15?.t $ h4 6 N of ( omtm uon ey,r nditures "* 67.7 % W' il8 8 th O bel Mi % 1% Rates of ReturnI arned: lotaic apitahationi(hier ex omei 10.4 rir il 1 10 J 10
- 11 7- 4.0 ' ,1 %
As g e ommon ettuih befo'e estra. ordinan item and a t hange in au ountmp method iNet to t ommom 14.3 % 19 4 110 i; " tJ' 10 5 II 6% Av g ( ommon etyth Ni to c ommon 14.3 % I; 4 11O 14 1 00 ?o % 11 6 % l'retas Cmernge of luterent lNwnse 10h 102 J 81 nl J %1 1 as J 66s I.ffrethe lpromelas Rate M4 31 0 4h '" 48 38 % l'a>uut Ratin on lHt idends i'uld NO.3 % "2 915 G0 1. 5 H. ; 104 4 ti l.1% lionL Value l'er Share $17.14 17 13 16 44 +n i % bi 17 i5 $ 1b 40 kumber ofi ruplopen-har l:nd 6,611 0 616 6 %4 64'0 t, 'iD i " D44 kl45
'trK lodr4 debt due withm one sear. notes pauble and ( ommen tal paper and pretened (!m i subs Iin maw laton redempt on o ;thm one u ar "C.nh provided from operahons net of t ash used tot dwidemh. I USD t ak utan'd as tands generated mh,malk
*
- T tll( U ktfd a% ( adl p'Oylded Nom (y WrallflM . ! of ( gldt uWd l# df cl(len(h ( bi Ided I% t (lf klGR IM U! esj WfI(l:Iif f tS nt't (d *V ( R. e(plIt) ( (.Mf Pt'nl l440
< ak ulated as fund > renciated mternalb as a % of net ( on'aru(14on e spenditen
""itefori tstran dinarv itern 21
MANAGEMENT'S DISCUSSION AND ANAIXSIS hblic Servk e Gnr my of ColoradoimilSubskharin Results of Operulloth low er gas rn enues. Total gas dehs eriet how ever,inc rcased Lar nings per share were $ 2 A ?, $ 259 and i L 14 in 1940, D% and 4% in 1990 and 1n80, respn tively. as a result of a 1989 and 1988, respectivelvihe(omparabihty of thne substantial in( rease in gas gathering and prot essing activi. amounts how ever, is afte( ted by the ret ognition during tin and transportation servit et T he per unit ice ( hatged for i 989 and 1988 of ( ertain non re( urting items as discuned transportation servit es, w hile significantly lew than the per below,in particular, sint e August 1989 I ott $t Ytam operat- unit amount ( hatged for a sale to a sirmlar customer, pro-Ing and maintenant e expenses teu luding present value udes an operating margin equivalent to the margin ear ned adjustments to the deimhng and det omn duionmg liabihty) on gauold.Consequentiv. the 1990 and 1989 revenues have not been reflet ted in operating expene on the ( onsol- have been ads erselv affe( ted by this ( hange m t ustonmr idated Statements of inc ome but has e been ( harged doectly delivery mn without a (orresponding impac t on operating against the defuehng and det ommisdoning liabihty on the inwme. In addition and similar to gas transportation ser-consohdated balan( e sheetusee Note 2. I ort St. Vrain vk n. the per unit fee ( harged 1or gathering and pro ( essing Nut lear Generating $tation in the Notes to Conschdated actiutin k also signifK antly Ins than the per unit amount Iinantial 5tatementst The int lusion of I ort St. Vrain operat- ( harged 1or the sale of gat Therefore, inc eases in sut h ing and maintenan( e expenses in operating npensn in and adivities a ill not has e as grea'of an impad on gas revenues prior to August 1989 had the effect of reducing earnings per as int reases in deliveries from the sale of gas. j share in 1989 and 1988 by appeosimately 19 ( ents and 3 $ I I c an4.ampnahng rn enum e e eHn t ohate ( ents, r espectively. In addition, the re< ognition in 1988 of
$63.8 million ($ 39.6 rnillion after tau of additionaliort St.
Vrain defuehng and detommissioning expenses had the "#U"**"P # * ** * # #" M """U salm am wnn. omMndadms ah mn mteMo effect of reducing 1988 earnings per share by approsimatelv annual ( hangn in revenun w hen compared to revenues for 7,; the prec eding years as indicated in the following table. Rnenues MH"i"'of D4"o T he moderate int rease in 1990 elec tric operating rn enun, W ** when (ompared to 1989, is primarily due to an increase in U" '"' "* "'r electrit sales volume and the positiveeficct of the revisions ,]' jd] ,q I I f in the negotiated electnc retail base rate redudions. Auhs' sAmoLmundamer Ww s 19A Nt cuned in greater detail below under Rate issues, base rate g, , g g g gg reductions amounted to approximately $ 24 milhon in 1990 as compared to $ 36 million and $ 30 million in 1989 and Gd{' [ ['" 1 ,, , gg g g 1988, respectively. A 2.2% inctcase in sales volume was pn,* vr WmndA en d and othm hangn (Mn 6 op marily attributable to a 0.7% increase in customer growth. g gg, ggg ggg These positive factors contributing to the higher 1990 reve-nues w ere offset, in part, by a reduction in energy costs recovered thmugh the Eledric Cost Adjustment (LCA' "ior Operating thpenws to the cessation of operations at Fort St. Vrain and in acwrd- T he increases (da reaseu in operating expenses f rom the anc e with the 1986 I ort St. Vrain Stipulation and Settlement prn eding year were as follows: Agreement, the [CA included a provision for generation wnons a nong, i from the nuc lear plant. Termination of suc h operations has t999 we9 resulted in the elimination of this provision; consequently, f vel uwd m genmnon i 14 $ ot IC A recoveries are low er during the current perkd Higher Pa hnnhwer 6.9 m sales volume in conjunction w ith the rec overy of in( reased u eau heuuoomote t21m tp energy costs through the [C A served to inc rease elec tric C#'h"' "PC'dh"d *M*"* II 22 " operating revenues in 198nw hen wmpared to the preced-ing year. A 2.7% increase in the 1989 electuc sales volume ((.((""*" ""*"**" pepremnon gl 3.7 jf i9 over 1988, of whic h the majority was from sales to industrial Tasmother ihon in< ome niwo 2.6 to and commercial customerb resulted primarily from a 1 % tme te 7A . s.s increase in total customer growth. e notowmmene 5 1.1 5 (ic h The continued decline in the cost of gas from suppliers, f uel used in genn#on espense in( reased slightly in 1990 which is passed on to customers Ihrough the gas wst adjust- when mmparmito 1989. A nunimalin( rease in the per unit ment, coupled with lower gas sales twhic h exclude trans: cou of coal muplM w ith a mWeate inc maw in generation ported gas and gas gathenng and proc essing a( tivitie9 of at the Company's fossil fueled fat ilities were the primary f at-1.3% in 1990 and 2.5% in 1989, when mmpared to the tors contributing to this inotase. Despite increased genera-respective pre ( eding year, were the primary reasons for the tion in 1989, fEl used in generation expense remained 22
l' relatively stalde when ( ompared to 1988. Low er per unit T he slight inc rease in 1990 and 1989 depr eciation expense, fuel wsts in 1989, wben ( ompared to the pre ( eding period, w hen compared to the respective preceding year, is primar-contributed to the minimal change in fuel used in generation ily aloibutable to plant addrtions. In ! 988, how ever, the expense. depreciation rates were reviuti vpon wmpletion of a mm. pr ehendw &pWah n Mudy w hk h conduded that the purchased pow er emense inc reased in 1990, when com-
"# *# D'" # #
"*P8"dd' "
pared to the same period a year ago, primarily as a result of should be eeended. Therefore, the 1988 depreciation j an int rease in Kwh pur( hases. W increa e, how evet wa
- partially oHset tiy a decrease in purc hawd power espense P 7 ""
- UPP*E"dO * ""
l adjustmens which conelate to the reduction in operating "y""n*ane# rn ntaun 11 ms pn sharensee Note l . Summary 4 revenues anociated with the E C A l'urchased power gmhcant An ountinFohrms in the Notes toConsoli- ! ewwe inueased in 1989 over 1988, even though the amount of energy purc hased doc hned, due to higher per Taxes other than in( ome taxes inucased in 1990 and W89, ' unit costs for the energy purchased. T be Company has pur- when compared to the respectn e preu ding year, primarily chased in each of the past tw o years, when rompared to the as a result of higher proper 1y taxes. !nueases in the milllev-respective prec eding year, an inocasing amount of energy les as well as higher assened property values ( ontributed to 1 from Quahfying Facilities (QF's)w hich charge a higher rate the higher property taxes in both years. per Kw h than the Companyi other suppliers of power.1he { Higher in( ome before lnwme tawn ontributed to the : 1 Company is requieed to purc hase power irom certsin QF 5 inucase in 1990 in( ome ia x expense when compared to ! and espects total purchases from Qi 's to increase m the .
# "'""'Y"" "E #*"" "' O "#U"U future due to regulatory requitetnents, in addition, higher !
- per unit costs for the energy purchased from the Company %
was o "'n q*, o"r"w## hkh no !
#"" w an mucaen ta"Pulap"" *5*Nd""d' dd"*
""""W""*
a other suppliers of power aho contributed to the increams in nwntuhat moned in M, tMntn aw in W89 incone purchased power expense, tax experne, w hen (ompared to 1988, was for the most part 4 Cas purchased for resale expense decreased signi6c antly in attributable to increased inwme before income taxes. In ]. 1990 and 1989 when compared to the respective prcreding June 1989, the estimate of defened ta e for the period Janu. ; year, The decrease in both periods is attributable to lower gas an 1,1987 through lune 30,1989, to be recognized as a i J sales of 1.3% and 15% respectively, wupled with a contin- ' rnsult of taxable contributions in aid of c onstruction under ued decline in the per unit cost of gas purchased. the Tax Reform Act of 1986, as revised, resulting in a 4 While nuclear operating and maintenanc e costs have been *"".e in inwnw tauwpm of approdmakh $ W9 me excluded from the calculation of earnings since the cessa-Un a nu,howmn wamHM h odwr Ng i tion of operations at Iort StNrain in August 1989 tsuch costs "d"""*" # "' "#
"*"# I"N"* "W*E thow tr $gmed by the early ( essation of operations at I ort St.
are now being c harged against the defuehng and decommis-pa ne a den bawodaW weik N sioning liability 1 the 1990 other operating and maintenance l expenses remairkochelatively stable when compared to
, ain euraonhaMW wm wmgnW a%m i
I*## #"
- C * ### "'
1989. Higher administrative and general espenses durin i the cunent year coupled with increased expenses included in the 1989 tax return. Consequently, this differ- ; at the 'g ence in rates resulted in decreased tax benefits of approxi-Company % other production and distribution facilit,es i matelv $8.9 million. ! served to minimize the change in other operating and main- 1 tenance expenses. General incteases in the wst of labor, 1he substantial decUne in 1989 miscellaneous inwme and materials and supplies as well as a $ 101 miHion inucase in deductions-net, when compared to 1988, resulted from the , the present value adjustment to the defueling and decome recognition in 1988 of gains on the sale of various land sites; l missioningliability were the primary factor 5 contributing h e in 1.990 declined primarilydue to a to the 1989 increase m other operating and maintenance du m i@meu expense on long term debt.1hedecline 0 expenses over 198fpsee Note 1 F ort StNram Nuclear , was the result of the retirement of $ 35.5 milhon in fint mort- ! Generating Station m the Notes to Conschdated Financial I ga e bonds and $ 25.0 miHion in medium term notes in the Statementst i hrst quarter of 1990. The decrease resulting from these H Asaresultof a reassenmentof theestimatedcostof the retirements a as mitigated by the increased interest expense ) defueling and decommissioning activities in 1988, a n addi- associated with $ "5.0 million in first mortgage bonds issued tional expense of approximately $ 63.8 million ($ 39.6 mih in July,1990. While total 1989 interest expense was virtually ! lion after tax or 75 c ents per share)was recognized during unchanged when c ompared to 1988, there was a decline in ( - that period (see Note 2. Fort StNrain Nuclear Generating long-term interest expense w hich was more than offset by an Station in the Notes to Consohdated Iinancial statementst inuease in other interest expense, reflecting a c hange in the amountoflong andshort termdebtoutstanding l
-n- . _ . . _ _ _ _ _ . _ _ _ . _ _ - . , _ _.---. _ .. __ _ - , - . - _ _ - _ , _ _ _ _ . . - - - _ _ . ~
l l MANAGEMEN FS DISCUSSION AND ANALYSIS ~ comiwd Mlle Servk e Cmpanw! Cohn ado amt Mudiancs l During i440, the total number of share > of common stock reduction until May 1940 and to irnplement a 1,11% redue issued and outstanding int reased by 1.51102 bhares pri. tion in plat e of the 4.29% untd Nm ember 27, i 490. In adda marily due to inacased activity in the Dividend Remvest. Son, the Compans agreed to refund anmunts carred in ment Plan whic h sers ed to negativeh impact earning ( per eueuof rexulaton authoniation,if ant tor the period lanu-share byapproximately $0.04, arv 1. H;90 until Nos ember 27, t 440.1he Company does not helin e carninp during this period were in eu eu of reg. heently luued Accounting Standard
- Nnt Yet Adopted ulaton authoii taton.
In Det ember 1990, the I inant ial Au ounting 5tandards
. Iloarthi A510 issued $tatementof Financ ial Ac(ountmg Standards No.106 "Imployets' At tounting for Pustretire. """Ud*"d"'T"'"#" "*" '" "" "'I"'
ment Bet.cfits 01her Than Pensione (51 A5 f06)which
'*"""""" "' "PP "#b
- M'
$ th0 mHhon and $ 14.4 rniPeon resp"ctiwly.
estabbshes the auounting and reporting standaru.s for postretirement benefits other than pensions. T halatement in addition, effe(tive November 14. I 987,the rules and requires the au rual, during the years that an employee ren . apph( ahuay of s arious electric rate dawific ations were ders servit e to the Company,0f the expected (ost of ptovid. re/sud by the CPL 1C. T h:s revision gave (criain eie( tri( ( ue ing postretirement benehts to the employee and the tomers the oppmtonity to t hange r ate danifk ations a hk h employee's beneficiaries and covered dependents. The resulted in a 1988 revenuNedut tion of apprtnimately statement is effective for fisc al ycars beginning after Det erm $10A million. ber 15,1992, with early adoption en( ouraged. The Com' pany has not yet deternuned when the standard will be N Co We rm Wh h CPW owmam qumung a rndhon inorcasein the Company,s adopted, or how it will be implernented not has the Com-revenue levek based on a test y ear endinn September 30, pany quantified its finant ial impact w hen uhimately adopteu. Although the effect of adoption has not been fully mo .& MiMMddummphs things, a 0.82,% deucase in electm rates and a 4.30% detemu.ned, due to antiopated future regulatmy treaunent, g , ,gg ,g g the Company does not espect adopt,on i to haw a matenal
" " " "*"""F"" "U " "' '"'" ""
effect on results of operations. of 1 Oh8% and an authorl/ed rate of return on equity of in December 1989, the iASB Iwued Statement ofI inancial t US% in addition, the Company k asking for indusion in AC counting Standards No.103 " Anountirg Im inc ome rate base of the Construt tion Wwk in Progress balanc e at Taxes-Deferralof the lffective Date of fASB 5tatement No, September 30,1990, fuli normalization of allincome tasrs i 96" whic h postponed mandatory adoption of Statement of k urrently, the Company normalleen ertain tas and book f inancial Accounting 5tandards No. 96>Anounting for differen( es, as requit ed, porsuant to federal tax law ), tet ov-Income Taxes * (STAS 9N to fisc al years beginning af ter cry hom ( uttomers of postretirement benefit auruah and December l 5,1991. 5fA5 96 establishes new financial an imputed capital structure for regulatory purposes that accounting and reporling standards to recogni/e tas liabili- appropriately allocates the fort St. Vrain write-downs to all ties and assets that rmult from an enterpike's activities dur- c omponents of the capital struc ture, rather than to t ommon ing the current and preceding yeart The IA5B inurrently evity alone. An OCC complaint,w hich was filed Man h 29, re-evaluatinppecific provisions of Si AS 96 and intends to 1990, has been c onsolidated into the rate case.1 he com,
- amend the standard. Se Compa ny believes applit ation of plaint contends, among other things that the Company's the new standard will noaignific andy impact the Com- authonted I a A% retum on equity is unrcasonable, The pany's reported net worth in be year it is adopted, Cornpany has agreed; upon ( onc lusion of the rate case, to a rate adjustment u hk h will recognite the chherent e, it any, Rate lunes beto een the new rates resuhing f rom the c omplaint case
' and those in effect from November 27,1990 through On iebruary 4,1988. the Company, the Colorado Office of Consumer Counsel (OCCf and the staff of The Public September 30,1991. UtilitiesCommissionof theStateof Colorado (CPUCI l he Company expects that the CPUC staff, the OCC and oth-reached an electric rate reduction agreement in respome to gi ggnge all or part of this rate filing.1he CPUC h c the Company s eamings in cuess of regulatory authori/ & d m iM ordhr anhe end of October 1941,While tion. Lifec tive Apnl 1,1988, the Company s electric rates ,. the Company beliews that the requested rate ,mcrease is lust were reduced 2JS$ or apprtwimately $ 27.2 nu,lhon ior a twelve month period. fifective April l,1989, a rate reduc-
"" #*""" ""IU" "" # "# # "" #""
Y tion of 319% became effective for the subsequent tweNe *"" ^"" * * """ d " issues in the case, including but not hmited to a decrease month pen.od .nplaceof the 2.75% rate reduction En~nt.we
.* " " N ", ' '"
* " " **"""4" "*
June 1989, the 3.19% rate reduction was revised to 4 NS the 1315% level requesteda ould result in an overall rate for the ternaining ten months of the twelve month period' l he Company w as authorized to extend the 4.29% ra e demw' 24
. - - _ . . . _ , - _ _ , - - . _ . _ _ _ , . - . _ _ , _ _ _ _ . _ , . _ . _ _ _ _ . _m._-__.-_
On November 21,1990, the CPUC approved the Company's require c oal buming pow er plants to reduc e sulfur dioside request to implement s atious rate adjuMments designed to SCM and nitrogen oucle AOu emkuons to spet ihed lee ehminate the poss subsiditation whic h edsted betn een the e!s. 'l he Compans is currenth meenng the enunion Mand-electric and gas departments. $uc h rate adiugmenS are atde, plat ed on SOz th!ough the use of low sulfur (oal T he j ef fective for the period November 27,1990 thmugh Novem- Company will be tequered to modih ( ertain boilers to her 1,1991 and coincide a ith the dig ontinuation of the reduc e NCh emiscont h is anta (pated that under uirrent 1.11% electric tate reduction dac uned ahow t hmination regulatory princ iples. any (osts irn utrod in the Company of the(tosuubsiditation is achieved theough a negathe would be re( overed fronutu ustomerL i Al% electric adjustment and a poshive 2J7% pas adjou. gggg gg gg ggg, g ment I hese aojuMments will result in an off setting $ 124 million revenue ( hange in each department, it a antiopated d MA>c N +'cM mem M@m mm-
,gg,gg gg, gf g ,gg g , g that the cross subsidization inue currently inherent in base the Compan) wdl attempt to reduc e $0e emissiom 50%
rates wul be addrened in the current rate c ase' 4 W dMiWeMohmW @ pen On January 7, f 991, the CPUC approved a $ L2 mulion mettopohtan area genetating umts and to reduc e NOs inc enth e aw atd to the Company for legal efforts espended emissions 20% by modif ying those generahng unds by th in obtaining a refund from Colorado Interstate Gas (ClGL a end of 1442. primary gas supplier of the Company. The Company, hc,w-ever, has not rec elved the final written order from the CPUC. linpart niinflatinn und Changing l'ricen The amount will be rec ognized in income w hen Anal Capitalintensive industrieuoc h as the utility indoury are approval 4 rec en ed from the C PUC. The award w as for the parta ularly affected bpigmfu ant long term inflationNery Company's elfort6 in pursuing and obtaining the Gas Secu h umph, dept et ialion on utillty propertv. plant and equip-Refund of approsimately $ 50.2 milhon, plus interest, f rom ment. w hk h in harged agamst eatninn for anets a( quired
- CIG. The refund wHl be made in four annual instahments in the pau, does not reflec t the mflated unt of m quiring sim-the first of w hich was rec eived in September 1990, ilar awett Comequenth, hmher pmfits may be reported on a ( ontinuing bakis with no a( (ompanying gain in teal pur-1:Hilronmentalluucs chasing po" er or et onornh ialue. llowever, the stabili/a.
The lowry Landfill in southeast metropohtar Dem er has tion of inflat on at relativeh low levek ha mmimited this been Jesignated by the i nvironmental Protection Agency impact on the c unent operatmg tesuhs (IPA)as c 5uperf und site pursuant to the Comprehensive Environmental Response, Compensation,and Liabihty Att 1,lquidlly and Capitalliesources (CERCL Al Under CE RCL A, the I PA notihed Potentially Responsible Parties (PRPu of their potentiaHiahditv fo'r the Cmh pmuded by operations inucased 53.8 milhon in cleanup ef the site. The Company, which used the site for
,w n mmpare JMpite a net int rease in i ort disposalof trash and neutralized liquids generated in its boiler cleaning process, has been named (Jong with many
' " d "'" "# "'"* """E#*E"" #""
others as a PRP at the lowry Landfih.1 he [PA has begun its 0'unedo S a o appmumatchW m@on remedial lnvestigations and feasibihtotodies at the i owry taduabpendnumunmad 52g mHbn w hHee pmp enWalun$uMmentutedned 5 3 undhon usuWng n* Landfill for the purposes of identifying the appropriate method of cleanup, its attendant cost, and the allocation of
"""""""""I " "' A I * " I"f *d "
the(leanup cost among various PR Ps.T he Companv is
* " "" """ E"""EPh " "*"d * "*"O d " " 4 tM@enMuchng anMemnvWubning eendduns actively participating in the Lowry Landfill De Minimfs Group w hich w as organized as a result of Ihe IPN5 declara- Cash used in inveMing actwaies we $ i 13 A mulion higher tion that it would seek a de mimminettlement at Lowry during 1090 than in 198n. An additional $86.8 milhon in Landfal. The EPA requested that the PRPs organize them- 1990 mmtruction expenditures as well as the funding of selves to negotiate a settlement for the PRPs whose c ontribu. premiums on < orporatch held insurante policies using tem-tion of waste at the Lowry Landhu is minimal in volume and porary ( ah inveumentW ash equivalento in 1990 rather toxicity. in addition to the Lowry Landfill, the Company has - than longer + term investments as in the past, accounted for identified several sites where cleanup of hazardous waMe themajorhyof thischange.
may be required. The Company fully intenck to pursue the recovery of al! costs incurred for such projects through h"0"Ci"Mw&hs equimW m.nhnlem aMn I 000 than m. 1989, I he primary facton contributing to th,n insurance coverage and/or the regulatory proc en. . oeuease a ere the not effect of a $ 19.3 million increase On November 15,1990, President liush signed into la w the resuhingirom theissoanceof common CocL theinuanceof Clean Air Act Amendments of 1990 aimed at low ering the $ 75.0 milhon,9W hrst mortgage bonds in luly 1990 and a acidity of rainfallin the United States. The Amendments $ 37 8 milhon net increase in shorI-term borrowings offset by 3
.- .--- . .~ _ _ - - ~ -
MANAGEMENTS DISCUSSION AND ANALYSIF Comaawa 1%blic Sm it r Counpwn nf Color ado uml%ulsi, lwr in by the redemption of $ 35.5 milhon in hesi rnortpge bonds int teaunn the les el of inte mediate term honow inn under and $ 25.0 milhon in enediutn term notch in 1990. P$ Colorado Credit Corpor tionMPTCC)medmm lerm
*mimpun m og io.Nem6ono ng unden om-Net cash provided ln operatiom m 1989 dec reawd $.'O.b .
milhon, when compared to 1981), despite an inucaw in not
"" """""#"'" "' " " " '" " E " 0"#
- C" in( ome of $ 23.0 rnillion. T his different e resulted primarily (m .w g nd am w% t W oqnumg emew .mh an ( ngapnsng on ma and huunen from $ 63.8 milhon in detueling and de mmminioning (harges included in 1986 net inc ome w hk h did not repre. ""W""' 0* "" " " "
- I " N '" ' "" * "" D I d "' "'
wn (ash requirements of that period. uhnwny am uubdann In 1489, the Company ametuk u the Automatic ()h idend Prospecthe Caplud Requittments und Suurers Reinvestment and Cornmon Stot k l'or( hase Plan w hereby At Dei. ember 31,1990, the Company and ituuhsidianes Ituhareholders rnay purt hase additional shares of ( omnmn estimated thee,ostof their (omtruction program, int luding stoc L of the Company through the reinvestment of( ash divi-Alkm anc e I or I unds Used During Comtruction ( Al DCl and der:ds at a h dix ount and optionah ash payments w ith no other c apita! requirements, in 1991,1992 and 1993 to be as prit e thu ount. The 1991 1993 prrn eeds from the dividend follows: reinvestment plan. estimated at approsimately $ 109 nulhon, d huownds of Ih diam a also (Houd&nds to nu'el WW apha! tequin'rnents of I991 I992 1993 the Company. Combmr At Dec ember 'll,1990, the Compan) and ituubddiaries luchoni 1 alu,41 % 6066 $ Lutn'! W udngl N inminienN int , MW had ternignam ash inmsmmion m ?e mim go non investments of $6.6 milhon, PSRI held investments totallng Davihuuon n, not nom ot. 6w $ 2 U rnillion, of w hit h $ I i J million ate (lawihed as tem-Ge- ! ?, w ani 22 la purary( mh lm estmento (Whe*al ~ % b6l 59,400 41.400
' N ' ## I3 'i inadotal .!b31l 240 9?O l b?,62n -
sulnhtiarin anna 44pa avj nulhon in short term debt, for use primarily in the pun hase lotal t onungtion Jonto? ;0Ulia J R pu of the CompanO( ustomer au ounts ret eivable and fosdl t ew Af Dc a na,8 i t /,n n.029 fuelinventoriet PSCCC mag petitxhcally c onvert short. Add %nLinglundwideld mahouetw 14.661 IA7M 4M% term (lebt tointertnediate termdeht W(Willet Asofl.)etem-4!kt Iort st Vrainthommimonmg ?fdW 4290 h(04 I her 31,199(), PSCCC had $ 10.0 milhon in intermechate, t k*lueling 4cpimermy" lotalt annai renunemenn'" $4nVw 540W/ lEn,4 tied directly to daily c hanges in the level al the Company's Tapitai requoements to, Iin tot hodut non are net of Depetment of outstanding customer a( ( ounts tec civable and month,y inern fundmp of dean uviin teolon prom tiof 512 A nulhoe for tNe c hanges in Iowil fuel im entories, T be Company es per, ts that
" the amount of financing eno( lated with PSCCC w ill vary
. t i nh foe derommnuoning deiuolms and remmering mume tho rativ aamant'ement on ommnuonmpporoar h and are connah bm yea
- year Wmugh wasonM k tuations net of eu rns fundonailat,E in tho levelof awels willcause(onespondingfluctuations
'"10tal t apnal requireme' i io not indude ( apHal una for at nunnions in the lpypl Of g%ociated(mancing.
The construction program of the Company and Ituuhddi- In 1990, the Company filed a egistration statement w ith the aries is subject to continuing review and adjustment. in pat- Sk uraties and N hange Comminion for the Iwuanc e of titular, actual comtruction expenditures for the elet tric $ 500 million principal amount of first mortgage bonds of system may vary from the estjmates due to c hanges in pro- which $ 200 milhon was dedgnated for a wc ured mechum-Jected load grow th, the desired reserve margin and the avail
- term note program. Subsequent to year end 1990, $55 mil-ability of purc hawd power, as well as altemative plans for lion print ipal amount of mechum-tenn notes were issued.
- meeting ihe Compan A long term energy needs. in addition, actual decomminioning a nd defueling es penses ma y "
- P# " " #"# N"" h"0"""'d ""0 firstenortgagehandstotheextentof 60%of thesalueof net
- exceed theestimates due to a varietvof factort additions to the Company,s unhty property, provided net At December 31,1940, the Company and its subddiaries earnings before depre( iation, taxes on inmme and interest estimated that their 1991- 199hapital requirements would expense for a rewnt tw elve month period are at least 2.5 be met principally with approsimately $614.5 mi!Iion from times annual interest requirements on all bonds to be out-external sourc es and with funds from operations. Mans for standing, At De(ember 31,1990, the amount of net addb the sale of securities during the forecast period has e not tions would permit (and the net earnings test would not been formalized at this time. The Company and its subsidh prohibit theissuanceof approxirnately $272.0millionof aries may meet their external capital requirernents through new hotids (in addition to the $ 200 milhon printipal amount
- the iuuanc e of first mortgage bonds or common stor L, by of secured rnedium term notes dis ( uwed above)at an 26
,_~ _
REPORT FROM MANAGEMENT Public Sen irr canpany of Colwado wsd Sukidiaron 4 anumed annual interest Iate of 9.95% Coverage under the Report of Managemont not camings test, at De( ember 31,1990, w as 6.11. 1he an ompanying 6 nan (ial statements of public Service The Company's Restated At tic les of Inc of porabon prohibit Company of Colorado and subsidianes have been prepared the issuan(c of additional preferted Stoc k w ithout prefened by Company personnel in wnformitv with nenerally shareholder approval, unlew the gron in( ome available for au epted au ounting prin( ipleu onsktent with the Uniform the payrnent of interest t harges for a rec ent ta ch e month $ntemof Auountsof the Federalinergv RegulatoryCom. l penod is at least 1.5 times the total of(1 ) the annual interest miwion. T he integrity and objet livity of the data in these requirements on all indebtednen to be outstanding for more finarn ial statements are the responsibilitg of management. than one year and QMhe annual dividend requirements on f inancial information ( ontained elsew here in thk Annual all prefened sto( k to be outstanding. At Dec ember 31,1990, Report in onsistent w ith that in the financ ial statements. grow income available under this tequirement w ould permit the Company to inue apprmimately $ 1.3 billion of add" W-Qnwm mimied enm stem of internal tional preferred stot k at an auumed annual dividend rate of o diMd g d Wmidmhmbhu. gg g , 0.75% Coverage of grow inwme to interest ( harges, at De( ember 31,1990, was 3.83. d &bWW%e haiM wdWie n&M a program of intemal audits to auure management that The Company's Restated Atticles of inwrporation prohibit, proper proc edures and methods of operalion are used to without preferred shareholder approval, the bsuant e or implement the plans, policies and dire ( tives of manage. assumption of unsecured indebtednen, other than for ment. Management hau onsidered the internal auditor's refunding purpmet greater than 15% of the aggregate of and the independent public au ountant/ tewmmendations - (1) the total poncipal amount of all bonds or other securities durmg the year con ( erning the Company's system of internal representing sewred indebtednen of the Company, then wntrols and has talen at tions thM w e believe are cost effec. outstanding, and p)the totalof the capital and surplus of the tive in the (itc umstan( es. Management believes that, as of Company, as then rewrded on its books At De( ember 31, De( ember 31,1990, the Company hystem of intemal wn-1990, the Cornpany had outstanding unsewn d indebted- ttok is adequate to at wmplish the obje( tIves dkc uned nen, including subsidiary indebtednee w ith the orecht above. f urihermore, the an ounting proc edures and inter. support of the Company,in the amount of $ 167.1 million. nal wntrol system of Ihe Company are review ed by the T he maximum amount permitted under this limitation was Audit Committee of the Board s ' Dire < tors. approximately 5298,7 million at December 31,1990. The a( rompanying financial statements have been exam-Arrangements for bank lines of credit totaled $ 150 million ined by ArIhur Andersen 6 Co., independent public in committed lines and $ 150 million in unwnunitled lines au ountantt Management has made available to Arthur at December 31,1990, at which time $ 231 million w as Andersen & Co. all the Company's fmancial recmds and available to the Company and c ertain of its subsidiaries. related data, as well auepresentations we believe to be valia The Company could generally borrow under uncommitted and appropriate, preapproved knes of credit upon request; however, the i I banks had no fir m wmmitment to make sut h loans. Q g) 3% m (,,mty On f ebruary 3,1991, the Company and PSCCC jointly entered imo a credit facility with several bani s providing w w oneim mn Da na k
$ 300 million in bank knes of credit. The facility consists of Panowl h ou*ng odur Chm'i m umr okei
$ 150 million in available commitments and $ 150 million in deferred commitments. T he availabh wmmitments will be used primarily to support the iwuance of commercial paper by the Company and p5CCC and are available for (brect bor.
. rowing thereunder,The deferred commitments are standby committed lines of credit that can be ac tivated with five busi-new days notice. Generally, the banks as participants in the facility would have no obligation to continue their commit-ments if there has been a material adveise change in the businessorfinancialconditionof theCompany.Theiacility, 1
-which expires Iebruary 6,1992, replaced the $ 300 million of individually arranged bank lines of credit in effect at the j time this facility was entered into (see Note 6. Bank Lines of J Credit and Compensating Bank Balances in the Notes to Consolidated financial Statements).
27 1 m - - , - , , , Y
RIIPORTS FROM AUDITCOMM11TEli AND INDlil'liNDl!NT PLillt.lc ACCOUNTANTS Miic $mh e Comparn of Color ado arulSulnidiarin ' Reporiof the Audit Committec We ( onduued our audits in an ordan( e w ith generally of the lloard of Directors au cpted a udit motandards. T hose standards requir e that
. n e plan and perf orm the audit to ot>tain rc nonable nsur-The Board of Directors of the Company addrenes its os er-anc e about whether the hnancial statemenk are tr ce of sight responsibility for the( onsolidated finandal statements matenal misstatement. An audit int ludes esamining, on a thf ough its Audit Committee. T he Audit Committee meets N Mit e idence supporting the amounts and dist losures regularlywith the mdependent(ertit ed pubhc an ountants in the financial statemento An audit aho in(ludes awewing and the internal auditors to discusuesults of their audit w ork tk m ounung pnciples used and signih( ant estimates andtheirevaluationof theadequacyof the miemalcontrok and the quality of finan(ial reporting. ddmnaramumH msaun@ omH Imm ialsterhmm MioMMdmw tM our audin In fulfilling its responsibihties in 1990, the Audit Committee provide a r casonable basis for out opinion.
rec ommended to the Board of Direct ( rs, subje holder approval, the selection of the Clompano$In our opinion, t to the fma nc ial statementuefert ed to above share-indepen' dent certified public at countants. T he Audit Comnuttee MWW Mer@m MMim @mikon of pshc krviu Company of Colorado and subsidiaries as reviewed the overall scope and spedfic plans of the inde-of Dec ember 31,1990 and 149, and the results of their pendent ( ertified public a( c ountants' and internal auditor,? o erat ons and their ( ash fio e for eat h of the three years resperth e audit plans, and discuued the independent ( erth Mtb r ud ended Dmde 3 L 1990, im oMonnitmie fied pubhc accountants management letter rec ommenda-genera hy au epted an ounting ponciplet tions, app. /ed theit general audit fees and review ed their non audit servic es to the Company, As more fully discuwed in Note ? to thn onmbdated finan. (ialstatements reahzationof theCompanisinvestmentin The committee meetings are deu.gned to f ac(.htate open .rs I ort St.Vrain NU(leat Generating Statton(approximately communications betw een mternal auditing, mdependent g., muhou Deceder 31,1990)as w ellas the tas certified pubhc au ountants, and the Audit Commu, tee. To ensure auditor independenc e, both the independent ( ert" dieof preWo d umniah deddorunodawd w th sa h investment for which node; erred tases uere fied public ac countants and intemal auditors have fuH and free access to th( Audit Committee' imd to Nmtmded ermimdd9J miHimt Deu der 31,1990s pnmarW dependent on the ultimate resolution of the repow cring inue, the eventual out( ome of
// .n g w hic h c annot be determined at this time, in addition, as more fully dist ussed m Note 2 to the(onsohdated financ ial I Whachm chai' man statementt the adequacy of the Company 's recorded liabil.
Aus commmer ity for defueling and decommissioning its I ort St. Vrain hbw,A w Nuclear Generating Station (approsimately $95 A million at December 31,1990)is primarily dependent on the succen-Report oflndependent imblic Accountants n uuonof tenainspendu uorage an pment inues and the succeuful development and implementation ! The lloard of litrectors and Shareholders of of a plan to dismantic, det ommission and repow er the f ort Public Service Company of Colorado St. Vrain Nuclear Generating Station as a ( onventional f adl-l We have audited the aa ompanying c onsohdated balan( c ity. T he outcome of the ahos e issues ( annot be determined , sheets of Public Service Company of ColoradNa Colorado at this time. T he ac companying financial statements do not ! corporation) and subsidiaries as of December 3 ' ,1990 and indude any adjustments that might resuh from the out( ome 1989, and the related consolidated statements of sacome, of these uncertainties. I retained earnings and cash flows for eac h of the thrc e years in the period ended December 31,1990. T hese fina ncial MMd+ drd4tN k, . j statements are the responsibility of the Company's r tanage- una+ omen x cn ; ment. Our responsibility is to expren an opinion on these Dem et Cokudo l
- l. :
financial statements b.ned on our audits 1 , ~- N
, -~ . , , --
CONSOLIDKrED STATEMENTS OFINCOME hablic Smkr Company el Color ado vnd Subsidhu in )hnundalDa ember 3I. lYwl, Iuw & 19M N o.m b eDonautv.ep+ershaeDetai 1990 1984 1988 Operatingitnenueu [lectric $ 1.145.915 $ 1,139.471 $ 1,1 15.464 Gas $61.712 577,282 591,493 Other 26.312 23,911 22,984 1.733,939 1,740,666 1,730,441 Operating 1:spenwu f uel used in generation 166,784 165,801 165,709 Purchased pow er 301.910 295.025 25;746 Cas purchased for resale 358.263 380,0'8 401 A114 Other operating espenses 332,516 324,991 307,149 Defueling and det ommissioning expenses (Note 21 - - 63,764 Maintenance 85.522 86.755 94.560 Depreciation 106,527 102,831 100,941 Taxes (other than int ome taxes H Note 10) 70,033 67,430 60,434 Inc ome taxrMNote 9) 73,97H 66,5;7 61,045 1.495,533 1,494,4b8 1,i l 1,162 Operating lucome 23N,406 246,198 219,279 Other Income and Deductionu Allow ance for equity funds used during ( onstruc tion l Note 11 3,444 1,581 516 Miscellaneous int ome and deductionu net 1.590 1.485 5,610 243,440 249,264 225,405 Interest Chargeu interest on long term de' , 75,075 77,627 79,001 Amortitation of debt disc ount and espense lew premium 1,543 1,385 1,300 4- Otherinterest 23,949 21,456 20,433 Allowanc e for bortowed funds used duting constru< tion (Note 1 ) (3.271) (2,044) (340) 97.296 100,424 100,386 Not income 146,144 148,840 125,019 Dh idend itequirements on Preferred Stock 12,439 12,645 12,850 1:arnings At ullable for Common Stock $ 133,705 $ 130,195 $ 112,169 Shares of Common Stock outstanding (thousands): Year end $4,320 52,807 52,458 Average $3,626 52,559 52,457 1:urnings Per As ernge Share of Common Stock Outstanding $2,49 $ 2,59 $ 2.14 Dhidends Per Share of Common Stock: Paid $2dH1 $ 2.00 $ 2.00 Declared $2dH) $ 2.00 $ 2,00 The acu mpanung notn to the (on.ohdated Onanciahtatemenh are an integral part of thne knan< ial uatements 29
CON 5OLIDATED BALANCE SHEETS , htblic Scryice Com/way of Colorado u nd Suhtidianes IM embcr 3).19WId 1989 l; Wima%of Don.w Awets 1990 1989 150 pert). Plant and I:quipmenit, ut cost: Dectric $2,650,0NN $ 2.579,761 L Gas NON.NIH 717,689 Steam andother 97,985 74,403 Common to all departments 23N,745 262,446 _ Construction in progren . 145,333 109,245 3,960.969 3,743,546 Len act umulated pros ision for depreciation 1,412.443 l 339,276
-e--a,-au m W 2,$48,526 2.404,268 M.4-r- m --i *,--i<+w , . - ---. i-- -_i+
F ort $t. Vrain related property (Note 2) 77,N02 81,737 Lee ac c umulated provision for deprec iation 17.067 17,662 4 60,735 63E75 Total Propert3, Plani and Equipment 2,609,261 2.468, t 43 Imestmenth.at rost _ 116.029 92E41 , Current Awetu Cash 8,92H 6350 lemporary cashinvestments IN,250 46,440 , Ac counts receivable, lew provision for unt ollectible accounts 0 990-$4,370: 1969-$ L235) 127,N43 136,223 Gas refund receivable 14,979 . Ac crued uni >illed revenues 66,$06 04,164 Recoverable purchased gas and electric energy costs-net (Note 1) 6$,h70 55.516 fuelinventory,2* average (ost ',43,427 34,3b8 Materials and supplies, at average c ost 71,919 76,937 Gasin underground storage,at c ost (Lif 0) 13,701 E092 Prepaid expenses 11.453 0.757 _Othe_r ._ _-.___- _-.- N31 269 . 1 TotalCurrent Awets _, , 433,715 _ 443j,16 Deferred Charges:
.-Debt expeni.e(being amortinch _
7,182 t,407 Recoveral>le nuclear ptant and decommissioning costs 5,025 l;,725 Gm refund receivable 29,957 - Other , _ _ 29,073 21,205-71.237 40,337 .
~
. 'intaI5ucts' $3,230,242 $ 3,044. ,937
.n , _ . ,
The aaompanying not 3 lo be ronsokdalext 6nanoal statenwnts are an integral part of $rwe hnanaal viatementt
't l
1 l I
- 39 . . - . u..____ _ . _;_; . - . _2 ._ _ . _ . _ _ . _ . . _ .._._._.~..,,w,_-. _.,_.._ ___. .,,m.,_. -
c housao omatam Capital anni 1.14 bilitles 1990 1984 Common l'. quit): Corenion @c k (Note h 5 7$1,149 $ 718.296 Rt tiined eamire. 212,$14 186.284 963,663 904,580 Prefert ed Stock (Nott 3i: Not subiet t to mandator) redt enption 140,00N 149 00H huhje(IIO tnandators f edemption al pef 4 6.34 S 48,944 l Amn Term Dt ht (Note di KN3,199 4N,129 A [ 2,033,23H ;,997,6bt Noncurrent 1.labliiticu Defuehng and decommissiorsint; babihtu Note 2 > 13,197 85,100 - Ga$ reiund habihty 29,957 43,1$4 85,100 Curt ent 1,labilitits ' Notes pay able and c onimerc ia; paper (Note 5 ) '!3,N33
. 151,208 Long term debt due within one s ear ,J 2,235 40.21?
Pretened stoc k subie( t t o mandaiors redemption , s w ithin one year (Note h 2.$76 ' 576 Act o mis pas able 177.7$3 161,4 Ll4 Dh idends payable 30,236 21,511 Customers' deposits 15,071 14 576 A( uved taxes 64,H76 61,4t:2 - Ateued interest 20,701 20,185 Cas refund habihty 41,162 3.890 - Curront portion of defuehng and dewmmissioning liabilt ts (Note 21 H2, th9 57,205 m, Other JN,VlN 41,041 [ Total Curf tnt l, labilities 739,$30 580,T 2 / Dsferred Credits Custome ts' ads an( es for ( onst:W tion .!d,768 15.816 Unamortized on esiment tax rredit 139,616 144,598 _ Ac cumulated def erred income taxes (No'e 9) 22$,M9 191,072
, Other H,$77 10,3 b 3
- 414.320 381,849 Commitmt nts und Contingencies (Notes 2 and 7) Total Cupital and 1 labiHties $3,230,242 $ 1,044,93 7
-- _ _ _ _ _ . _ _ . _ _ _ _ __ - - - - - _ _ . _ - _ _ _ _ _ _ - _ _ _ _________._a-__.___ _-__.___ _- . _ _ _
CONSOLIDXFED STATEMENTS OF RETAINED EARNINGS PuNic her s ic e G es;>an s ql Colora.lo mut hub siJun in h no e n le diDe s emba 3I, IYYU, IUNY & IY% tl b(hJhaf t h (ll(') elld!% > 1990 1(18 4 1988 llotalnod i',urnit@ ul llegittnllig ni Yout $186.284 $ 155.2 32 $ 147,944 Notlncos.e 146,144 14H 840 11;.019 332,428 _104.072 172,963 Dhlaends: On ( urnulatn e prefe'reci stoc k:
$ 100 par s alue:
4,1r t, se t ic' 420 420 420 [ 4 1/49., ser ies 744 44 44 I 4- l / 2"<, i,v rie s 2.93 2tli 243 t j 4.64 % series 742 742 742 4,40% series 73! 73; 7 15 \ ; 4.90"e 2nd series 73$ ?)5 ~ 15 7.15%enes 1,7d7 1.707 1.787 7.50% series 1.755 1,845 1,415 8.40% series 2.2$4 2,370 2,485 U 5 par s alue; 8.fD%e 2,940 2.940 2,940 12,40$ 12.61) 12,81 b On ( omnior.
$ 2.00 pef shdre ira I C/(l ','!89 afid 1980 107,b09 3 t"' lE7 104,915 119,914 '
Ta 9 ll? 711 lletnined ):veninp ut I: tid of Year $212.514 $ , &> 3 $ 155,212 m u(omp.vning not ,o e+ w.xa f nu anoakt.nenwna vi an miera! pet onhme e, nan < a.1 catenwnu l u l L m M
CONSOLIDATED STATEMENTS OF CASH FLOWS htblic Scrvicc Gunp<my of Gilomdo tmd Subsidiaries )hars ended ()ccember 3),1990,198Y & 1988 Ghousands omoltam 1990 1989 1988 Operuting Aeth itles: Net income $ 146,144 $ 148,840 $ 125,019 Adjustments to reconcile net income to cash flow s: Defueling and decommissioning expenses - - 63,764 Depreciation and amortization 113,426 115,763 115,834 investmenttauredit net (4,982) (5,267) (6,342) Deferred income taxes 34,287 37,020 (8,221) Allowance for equity funds used during t onstruction (3,444) (1,581) (516) Change in accounts receivable 9.012 13.138 (6,050) Change in im entories 5,959 (14,037) 1,530 e Change in other current assets 00,552) (9,254) (3,052)
- Chinge in accoun:s payable 13.319 21,609 11,782 Change in other current liabilities 77,507 40,998 11,839 Change in deferred amounts (27.959 p 12,319 15.777 Change in noncurrent liabilities (52,837) (85,323) (24,666)
Other _ , __ 13,896 15.533 13,834 Net Cush Prntided b) {)perating Aethities _ 293.776 289,458 310,532
- Imesting Activities:
Construction expenditures (261,221) (174,418) (162,806) Allowanc e for equity funds used during construction 3,444 1,581 516 Proceeds from disposition of equipment 4,686 2,025 1,132 Purchase of other investments (48,986) (129,861) (31,974) 25,798 137,827 24,440 _ Sale of other investments _ _ _ - ~~ _ _ _ . _ . Net Cmh Used in lmesting Actidtics (276,279) (162,846) (168,692) Financing Activities: Proceeds from sale of common stock 27,881 6,570 23 Proceeds from sale oflong- and medium term notes and bonds 83,684 19,843 73,902 ReJr ption oflong-and medium-term notes and bonds (94,008) (48,228) (30339) Proceeds from short term borro vings 142,793 222,790 660,225 Repaymentoishort term borrowings (82,168) (199,950) (714,532) Rehmption of preferred stock (2,576) (2,576) (2,576) Dividends on commen stock (106,753) (105,002) (104.914) Dividendsonpreferredstor_k _ __ (12,456) (12,662) _ (12,868) _ . -Net Cash Used in Finuncing Acthities (43,603) (117,215) (131,279) < Net increase t Decrease)in Cash und Temporary Cash investments (26,106) 9,897 10,561 Cash and Tennocary Cash in estments
.._ nt Ileginning of Year _
53,290 43,393 32,832 Cash and Temporar) Cash Imestments at End of Year $ 27,184 5 53,290 $ 43,393
- . - = =: = = = = : =. : :
The cecornpanying notes to the u.mohdated Gnancial statements are a s integral pan of these 6nandal statemenw L)
NOTES TO CONSOLIDAT ED FINANCI A L STATEM ENTS 1%lic Service Crmpany cf rcbrado wtd Subsidiaries
- 1. Summary of SigniDeani Accounting Policies in 1988, following a ( omprehensive depreciation study, the Consolidation {ompany n u quedadon ramuo nh anincrease
*I m anous Company Public Service Company of Colorado (the Cornpany) follows ac
."*"d'"
n eHn P ' "' ". u any w as a da n'aen N the practice of consolidating the accounts of its signific ant P' U """ " P"" * " " "" * """U"^^' subsidiariet All significant interc ompany items and transac. tions have been eliminated, m 11 wnphamWaWprMahnmnMn W approximales an annual rate of 3.10% on the average (ost
" * ^ ""P#*
Rnenue Recognition The Company and its subsidiaries accrue for estimated Replacements and betterments representing units of prop-unbilled revenees for services provided after the meters erty are capitalized. Items that represent less than units of were last read on a cycle billing basis through the end of property are c harged Io operations as maintenance. The c ost each fiscal period. of units of property retired, together w ith c ost of removal, in 1990, the Companv and its subsidiaries revised the D"k""#' P" d"""' ."
" "I" "" " *"Id N * - accounting treatment of refunds from gas suppliers which are passed on to customers. Previously, these amounts were f uel Resourc es Development Co. (f uek o) also uses the unit.
deducted from both gas revenues and gas purchased for of production depreciation method for producingoil and resale expense at the time of receipt with no effect on income. gas properties. f or income tax purposes, the Company and Beginning in 1990, such deductions are no longer reflec ted its subsidiaries use au clerated depr eciation and other elec-in the income statement although the refunds received tions provided by the tax laws. and corresponding liability to customers are recorded on the balance sheet. Revenues and expenses for prior years incomeTases have been restated to retlect this change. The Company and its significant subsidiaries file consoli-dated state and federal income taueturns income taxes are StatementsofCashFlows allocated to the subsidiaries based on separate company Accountingpolicy: for purposes of the statements of cash computations of taxable income or loss. flows, the Company and its subsidiaries consider all tempo. The Company and its regulated subsidiaries Westem Gas rary cash investments to be c ash equivalents. These tempo. Supply Company MestGas) and Cheyenne Light, I uel and rary cash investments at e securities having original maturities P w er Company tCheyenne) provide fer deferred income of three months or less or having longer rnaturities but w ith tam to the extent allowed by regulatory agencies including put dates of three months or less. deferr ed taxes arising f rom the use of au clerated deprecia. Income taxes and interest (exclud;ag capitalized interest) tion. accelerated cost recovery, qualifying act eterated paid: amortization and timing differences due to unbilled reve-nues w hic h include deferred gas and electric costs. In addi-ahousan<koiDann 1990 1989 3988 tion. the Company currently provides for deferred taxes on inmme tases $41.119 5 37.672 St%599 book tax timing differences arising from items associated intereu - 548,789 5100677 597.621 with f ort St. Wain (see Note h from certain customer refunds and for all book tax timing differences included Non cash transactions: Dudng 1990,197,862 shares of. in f edml Energy Regulatory Commission (f ERC)iuris-common stock, valued at ma ket price on date of issuance dictional rates. All of the Company's non-regulated sub-tapproximately $ 5.0 million), were issued to the Lmployees' sidia ries,1480 Wehon, Inc ., Fuelco. Bannoc k Center Savings and Stoc k Ownership Plan of Public Service Corn' Corporation (BCCL PSR In estments,Inc., and P5 Colorado
- pany of Colorado and Participating Subsidiary Companies. Credit Corporation (PSCCCt provide for deferred Iaxes An estenated issuance value was recognized in other operat' arising from all book-tax timing differences.
ing expenses during 1990. This stock issuance was not a cash t'ansaction and is not reflected as a source of cash in investment tax credi4 are no longer available to the Com-the s'atements of cash flows. No material non. cash investing pany and its subsidiaries as a result of rhe Ta x Reform Act of or (i iancing transactions were recorded durh ig 1989 or 1988. 1986. Previously recorded im estment tax credits have been deferred and are being amortized to income over the pro-Depreciation Policy ductive hves of the related property. T he Company and ituubsidiaries use straight-line deprecia-tion for accounting purposes. Composite rates are used for Amortization of Debt Premium, Discount und thpense the various c! asses of depreciable assets. Depreciation rates Debt premium. disc ount and expense is being amortized to j include provisions for disposal and removal costs of prop- income ove1he respectn e original hves of the applicable erty, plant and equipment. M
Issues or as directed by 1he Public Utilities Comrnission of tions associaied with suc h invesir ient for w hich no deferred the State of Colorado (CPUC). taxes w ere required to be provided (appro ximately $ 9.3 mil-lion at Det ember 31,1990t is primarily dependent on the Allow ance for l'unds nwd During Constructlon ( Al'DC) uit mate resolution of the repoweringissuedisc ussed below. AF DC, whic h does not represent c urrent cash earnings, is if it bec omes probable that au or a ponion of such invest-defined in the system of accounts prescribed by the f ERC men' and/or the related taxes will not be recovered, the and the CPUC as the net cost during the period of construc - Company w i;l rec ognize an expense equal to the unrecover-tion of borrowed funds used for construction purposes, and able amountiat the time such unrecoverable amounts can a reasonable rate on funds derived from other sourc es. The be reasonably estimated-Company capitalizes Af DC as a part of the cost of utility g g ggg ; ,.s naing performance during 1989 plant. The following range of Af DC rates were used for the and 1988. Fort St. Vrain did not pmduce revenues adequate yeJrs 1990,1989 and 1988: to okt n enses. Therefore, shortfalls of approximately W80 ._ _ tm im $ 30.1 million ($ 18.8 million after-tax or 36 cents per share) AF DC tates (U6%1021% 9.78 % I021% 9 M 4Ild1% and $ 35.6 million t$ 20.4 rnillion atter-tax or 39 cents per share)in unrecoverable eperating and capital expenditures Iteemerable Purchased Gas and Electric Energy Costs-Net w ere recorded during 1989 and 1988, respectively, locluded The Company. Cheyenne and WestGas recover certain pur- in the unrecoverable expenses for 1989 and 1988 are present chased gas and electric energy costs, in excess of amounts value adjustments to the defueling and decommissioning recovered through base rates, from their retail customers liability of approximately $ 14.2 million and $ 3.5 million, through various gas and electric cost adjustment tariffs. respectively.11penses for 1990 also rcfle( t present value These cost adjustment tarifis, which include a provision for adjustments of approximately $ 10.9 million. In addition,1990 the collection of deferred purchased gas and electric energy expenses include approximately $8.2 million asweiated with costs, are revised periodically as prescribed by the appropri- impaired nuclear assets, the majority being comprised of the ate regulatory agencies. T he deferred costs are the chiferen( e w rite down of nuclear .naterials and supplies inventory. between actual costs incurred and the amounts currently recovered from customers. A substantial portion e ' is Decommissioning and itep<mering deferred amount represents the costs incurred to p ovide gas l he Company originally contemplated the S AI STOR and electric energy which customers have used but for which approach for decommissioning Fort St. Vrain. Ihis approach they have not yet been billed. assumes the removal of the spent fuel segments from the reactor to storage upon cessation of operations at the plant, Iteclassification and the preparation of the nuclear portion of the plant for a Certain items in the 1989 and 1988 Consolidated financial prolonged decay periochapproximately 55 years), after Statements have been redassified to conform to the 1090 whic h decommissioning would be completed with the four. manner of presentation. year dismantlement of the reactor. Due to uncertainties sur-roundinglong-termmaintenance costescalation,regula-1 l' ort St. Vrain Nuclear Generating Station tory and environmental inues associated with this approach,
!mestment in llort St. Vrain theCompanyiscurrently exploringthefeasibilty :f anearly Oa August 29,1989, the Company announced its decision dunandemenfnonunissning appmach fu ror' SL to end nuclear operations at fort St. Vrain. T he decision was Vram. Under either the SAFSTOR or the early dismantle-based on the financialimpact of an anticipated lengthy out- nwnnt mmissi ningapproach,theCompanyanticipates age necessary to repair the plant's steam generator system thampowmng the facility as a natural gas tired piant would coupled w ith the plant's history of redut ed levels of genera- '"*"""'""P""C *P I " b**"I P""""
tion. The Company commenced the defueling process as immt eactm buMng, and a noWependent upan We discussed below in the section entitled "Defueling." completi nofdecommissioning. As a consequence oflimited operations at fort St. Vrain and The Company believes that early dismantlement /dec ommis-the removal from rate base in 1986 of the Company's invest- sioning an epow ering could he accomplished utihemg ment in fort St. Vrain assets, numerous losses have been rec- one hhe following three approaches. ognized in previous years including the write dow n of a a. The approval by the appmpriate regulatory agency substantial poruon of the total investment in fort St. Vrain of a long-term fixed price purchase power tariff for and the recognition of estimated future unrecoverable power produced by the repowered plant which
- - defueling a 7d decommissioning expenses. would be designed to pros ide sufficient funds to
! The recovery of the remaining investment in f ort St. Vrain ""'P"" "d"M " " " '"N '" "d b lapproximately $60.7 million' at December 31,1990t as unan
'S" %nwn uomo o ngm not ob well as the tax effects of previously recognized tax deduc- " " P"" "'*""" " P"" "'
n
NOTES TO CONSOLIDATED FINANCI A L STATEMENTS cominued PubHc Service Cmpany ofCelorado and Subsidiaries [bl ReceiptbytheCompanyof traditionalratebase mated. In the event the Com;)any determines an early dis-treatmentof thecostsof therepowered plant mantlement/ decommissioning and repowering appmac h Uncluding all early disma ntlement/ decommission- could not he adopted without recognition of the deficiency, ing costs not otherwise provided for). the Company intends to pursue the SAT S'10R method, a ch wmains a mW opdon. cc Thedevelopmentof an arrangement in whic h the Company and independent third partie would form On November 5,1990, the Company submitted a proposed a new entity that would fund the early dismantle- early dismantlement / decommissioning plan to the NRC. In ment /decommissioningandrepoweringof theIort all three early dismantlement / decommissioning scenarios St. Vrain facility. The cost of such activities not other- described above, the Company would retain responsibility wise provided for w ould be recovered by the new for the N RC license until t ompletion of decommissioning. entity through the sale of pow er to the Lompany T he Company believes that if S AF S !OR w ere currently and/or other customers of the new entity and th being pursued, the defueling and decommissioning liability
. Company s purchased power expense would be remd@wresent value basis would be adequate assum-ruovered from its customer.
M olutionof thedefuehngissuesdiscussed below. in order to arrive at the most realistic estimate of the Costs financial impact of the S AFSTOR defueling and decommis-Followingis a reconciliat.ionof therecordeddefueh.ng sioni ig costs (approximately 5213 million in 1990 dollars and decommissionmg cost estimate as of September 30' net of e enditures through De(ember 31,1990),over the
- ~1986, w hen the plant was removed from rate base, t time period anticipated, the 1990 SAFSTOR cost studies December 31,1990.
include escalation of expenditures at an average annual rate ahousandsof oo!!* of 5 A%anddiscountingtheseannualespenditu estopres-
- cefuennunddemmmisuonini Amivma 86 $ 95 aaa ent value at a rate of 9% If the Company is unsuccessful in gevisionin origmalestimatema tg _ ya m implementing an early dismantlement / decommissioning M9J 68 approac h and. therefore, subsequently retums to the 5 AF-Present salue adrestments accrued 28MO STOR methoct, the Company believes the ; ecorded detuel.
$ Ii_. - _ . dau_re_s. ing and decommissioning liability would be sufficient
_D _o ._ n except to the extent amounts will have been expended for Od""3"8d"dd" ."imiyogmgiubdgy-tv3y90 _ $ 9sw , , ,
*Dervenng ondudingcon o' activities. At December 31 I 990, expenditures todate for consm n gmenusFso $
such activities w ere not c onsidered to be significant, mmm = m. = " 60 d hushdemsidwdmis sew While the early dismantlemenddecommissioning approach to NRC approval and may be review ed by other regulatory may be a better altemative in some respects, the Company agencies there can be no assurance that the actual cost of has concluded, based on stud es prepared by Westinghouse defueling and decommissioning will not exceed the esti-Electric Corporation, that the inflation adjusted remaining mated liability. The original cost estimate included a contin-cost of such an approach including completion of defueling gency provision that allowed some flexibility for revisions !n , (approximately $ 202 million net of expenditures to dam) the defueling and decommissioning plans without a corre-will be approximately 5107 roJiion in excess of the deiuelt sponding c hange iri the estimated liability. How ever, under l ing and decommissioning liability currently recorded on the current SAFSTOR assumption . t he contingency provision l Company's books. The Company believes any of the three has been exhausted, Under either the SAF STOR or early dis-L eady dismantlement / decommissioning and repow ering mantlement/ decommissioning approach, th: Company b approaches discussed above, if successfully implemented, could be required to re sise the estimated cost of defueling ! wc,2d not require the recognition of this deficiency. How, and decommissioning because of any changes which may ever, resolution of a significant number of matters will be be required in the decommissioning plan by the NRC or required in order to achieve such successful implementa- others or because of the resolution of ather uncertainties tion; including thr establishment of an appropriate cost such as the disposal of spent fuel as discussed below. recovery mec hanism, obtaining approvals from the Nuclear Regulatory Commission (NRC), the CpUC a nd possibly the Defueling FERC and other regulatory agencies, as well as negotiating Af ter the cessation of operations at fort St.Vrain, NRC j satisfactory contractual arrangements and obtaining satis- approvals and license amendments necessary for defuehng u factory financing. As a result, there is no assuranc e that any were obtained and deiueling of the reactor core com-of the threeearlydismantlement/ decommissioning menced on November 27,1989. The equivalent of two approaches outlined above can ultimately be consum- of the six remaining spent fuel segments contained in the
'M.
reactor cue were plac ed in the facility's temporary storage and that the DOE was in ( ompliance with the National I wells, filling them to capacity. Without resolution of the Environmental Pohcv Act (Ni PAhequirements for the issues relating to the disposal of spent fuel discuned below, environmental awewments on transport ation, receipt and the Company c annot prtx eed with the remos al of any addi- storage of the spent fuel, tional fuel from the reactor c ore. NM W9 I . b G bd mwlh Mw in 19u5,theCompany,the Atomic lnergyCommission(now U.S. District Court for the Distrin d klaho against the Gov-the Department of Energy (DOE D and General Dynamics emor of Idaho asking that the Gm emor's han on shipments entered into an agreement to construct l ort St. Vrain. The of f ort St. Vrain spent fuel into idaho be declared unconstitu. 1965 agreement, as amended and modified, requires the tional and that the Governor be enjoined from taking any DOE to designate a facility for the temporary storage and action to ban sut h shipments of spent fuel into Idaho. On processing of Fort St. Vrain's first eight spent fuel segments. f ebruary 8,1991, the Governor of Idaho petitioned for Pursuanttothetermsof anagreementdated April 1, t980. review in the UX Coutt of Appeals for the Ninth Circuit among the Company, the DOE and General Dynamics. DOE against the DOE asking for a det laratory judgment that the designated its Idaho Nationai E ngineering i aboratory (IN EU DOE is not in compliance with the requirements of the for receipt of the Fort St. Vrain spent fuel segments. Cur- Nuclear Waste Policy Act(NWPA)and applicableenvi-rently, three spent fuel segments from Fort St. Vrain reside at ronmental law s, including N E PA, with respect to its agree-this facility. On June 24,1983, the Company and the DOE ment to an ept and store the fort St. Vrain spent fuel at the entered into a federal repository contract for the disixnal of INEL arut that the dol be enjoined from ac( epting any such spent nuclear fuel and'or high lewl radioactiw waste from spent fuel at the INEL until such requirements are satisfied. Fort St. Vrain beginning with fuel segment 9. Ombrm 1:L W9 W Gemoddemesd W Although the DOE is requ; red by federal statute to provide claimed right under the NWPr\ to disapprove DOE's ac tion a repository for permanent receipt and disposal of spent in designating the INil as the facility for storing nuclear nuclear fuel beginning in 1998, it currently estimates that weste from fort St. Vrain by providing notic e of such disap-this schedule will not be met until 2010. The establishment proval to the Speaker of the House of Representatives and of the DOE repository will be required for permanent stor- the President Pro Tempore of the Senate. Because the DOE age of the Epivalent spent fuel elements of segment 9. does not purport to be acting pursuant to the NW PA, the Although some temporary storage presently exists at fort St. Company believes that the Governor's disapproval is Vrain, an on site independent spent fuel storage installation inetiective. USFSI) will be required for the equivalent spent fuel elements On Mruary 19,1991, the DOE filed a c omplaint in the U.S. of segment 9 unless other arrangements can be made f or the District Court for the Distric t oildahe again e Governor e interim storage of these elements. The Company is currently of Idaho. Similar to the action filed by the Con pany, the pursuing with the DOE the processing of the equisalent .
" " M"* ' " ". I" spent iuel elements oisegment 9 at the ldaho facility in con-
. unconstitutional and preempted by I ederal law and to Junct.ionwiththeprocessingof thefirste.ightsegments.
enjoin the Governor from .in tertenng in any manner m the Despite the Company's arrangements w ith the DOE, the transportation to and receipt by the INLL of the f ort St.Vrain Governor of ldaho announced, in a letter to the DOE dated speniicel segments.On february 20,1991, the DOE mos ed September 15,1989, that the State of Idaho is unwilling to to consolidate its case with the Company's case. accept aay additional spent nuclear fuel segments from fort St. Vrain f or storage purposes. In an October 18,1990 letter Mi 6 WI b d&mwhhuW um uwe w, tMompansnwnain ano forwarding comments on a proposed Environmental Assess- . ment Study prepared by the DOE relating to the shipment u c mp eno
?*P " # #U"I eu ng yond Nwohr b M m and storage nf Fort St. Vrain spent fuel in Idaho, the Gover-nor indicated this policy would continue until there is firm
"*"d"#'
""" W "M' ""*'
at the plant for the storage of spent nuclear f uel could result progress on the part of the DOE in establishing permanent in costs w hich ha e not set been provided for by the Com-repositories for :he safe disposition of nuclear waste. In add.e . tion, the Governor stated that a complete Environmental pany yamountonuash.dpen&nt on boMm lengm o lann cmnppon m, uehng, d any, and impact Statement be piepared. In a letter to the Company dated February 6,1991, the Governor reiterated his position whede ndm M n uWmL that shipments of spent fuel from Fort St. Vrain would not be in the event the fuel shipment issues remain unresolved at accepted in the State ofIdaho. December 1,1491, the Company may c ommence with the u ng of ( tm to the ISF SI. The Company began On February 7,1991, the DOE stated in a letter to the Goser-nor of Idaho that it had legal authority to accept thc spent
"""*' "" "
- I" "## # *"" "
nuclear fuel, based on the 1965 contract disc ussed abos e, future delays in the defuehng process. Defueling to the ISf 51 37
NOTES TO CONSOLIDATED FINANCI A L STATEMENTS Comimwa 1%blic Service Company of Colonulo emd Subsidiarics could be completed by July 31,1992, resulting in an eight As previously discussed, a proposed early dismantlement / month ddayat an estimated cost of approximately $ 2 L decornmissioning plan has been submitted to the N RC. The million per month for a total of appoxin ate!y $ 21 million. ultimate financial plan for the early dismantlement /dec om-In addition, w hile the previously recognized defueling and missioning of Fort StNrain is dependent on the final approac h decommissioning liability includes a provision for the esti- selected in terms of the three options previously disc ussed, o mated cost of licensing and constructmg a six segment ISF St, Prior to the November 5. t 990 filing of the early d:smantle-the on going ISFSI maintenance costs as well as the ISF S1 ment'dec ommissioning plan with the N RC, the Company > decommissioning costs w ere not mcluded sinc e actual utih.- had fikd a SAFSTOR de(ommissioning plan and requested zation of an ISFSI had not been considered to be probable. emption from the N RC funding rule requinng advance Such costs, assuming storage of the fuel in the lSF Sl until funding to be in place ptior to the( essation of operations. 2020, when the spent fuel would be shipped to the Federa! The effect of the exemption would be to allow the Company repository, are est.imated to be approximately $ 22 m.llion, i determmed on a present value basis. T hese expenditures ed On emd demiWmim M4de 5% STOR option in ac cordanc e with the financial plan submit-w ere escalated at an average annua; rate of 5.4 % and dis-led to the NRC as part of the Company's preliminary counted to present value at a rate of 9% Costs assoc:ated with the removal and shipment of the fuel from the ISI Si to SWOR dnominionimAChemmial $n as ggg.o vil escrow hn addition to the existing the Federal repository in 2020 are assumed to be the reypon' & H debe mdmmw sibility of the DOE and, therefore, are excluded from this tomers)approximately $4.5 million annually between 1990 estimate. Hence, under the assumptions outhned above' and 2008 (the end of the operating license), so that the total total unprovided for costs would be approximately $43 mil" funds escrow ed, together with the anticipated eamings lion. However, the Company cannot predict at this time th themon, will be sufficient to fund the total decommissioning amountof he t unprovided forcosts,if any,or the timing osts during the S AF STOR decay and dismantlement periods, of the recognition of such costs.
%e Company would expect to fund the amounts to be The Company has notified the DOE that it is the Company's esc rowed annually from either debt instruments and/or intention to seek reimbursement from the DOE for c osts operating funds of the Company and its subsidiaries. The resulting from fuel shipping delays and additional costs exemption request is now pending with the N RC.
associated with the ISFSt. At this time, the Company is Defueling and other fuel related costs, of w hich the majority uncertam as to the ultimate c utcome of this matter. MMed m om bem 1989 ed 1992 and which
. the Company is not required to preiund, are being paid from
'# "P' """E '"" "'
r RC regulations, the Company is required to make fih ngs with, and obtam the approval ot, the N RC regarding {, "" *
*j "[ ""
certain aspects of the Company's decommissioning propos- g als. The plan must provide for the technical and operational spects of decommissioning and specify that provision will Tk Pdede Mmwndd hide WW hbiL de for the costs of decommissioninonot including o ei i e da iddem nh b . P *" "" #"**" "#"d"
- aeling)through NRC prescribed methods of advanc e U"*8 "*""'""" *" P** "**
tunding which are: lump sum prepayment into a fund, ment charges currently approximately $7.6 billion,which escrow of funds annually up to expenditure date, or insur-ance or similar form of financial guarantee. The NRC regula.
" " "*" " "'N"' "#"' P* ."
- P" P" " P " " " " * **
tions specify that advance funding must im in place prior to agreement w ith thenective N RC. E.Y"?"'j"ulyom- l ,1989, the C. the cessation of operations. However, in. tne case of orema-pany maintains $ 200 million of private insurc 'ce, the turely shut down plants, the financial arranaements consis-tent with the above regulations must be in place prior to "**"*" * . " "" ^ " " "' .I " dent involving a licensed commercial power plant in tne
- beginningdecommissioning.
d % Mads daghm mow && The Company has set aside funds for decommissioning in liaihty insuranc e, each reactor licensee, including the trust accounts that have a combined value of approximately Company,is responsible to share n, the liability up to the
$25.4 million at December 31,1990. Approximately $ 19.1 maximum amount through a deferred premium assessment.
million of this amount represents funds recovered from cus. The ma ximum amount the Company would be required to tomers and the earnings from the trust a( counts. The remain- pay in respect of each incident at a United States nu(lear ing $6.3 million, which was contributed to the trust accounts plant would he approximatelv $66 mi; lion twhito i ncludes in 1989 and 1950, represents funds not recovered from cus- a 5"'o sort harge). indexed every five years for inf!ation, prm tomers. Approv.imately $ l .7 million remains to be collected vided that no' more than $ 10 million w ould be payable per ! from customers by the end of 1991. incident m any one year. n
in addition to its liability insurance, the Company maintains retrospec tive premium assessments if losses exceed the
$ 1.06 billion in nuclear property insuranc e. N RC regula. accumulated funds avai able to the insurer. The present tions further require that policy proceeds be used to first maximum assessment im incidents oc curring during a pob make the reactor safe and stable, and then to decontaminate icy year is approximately $6 2 million.
the reactor site. Coverage oithe first $ 500 million of pten-Effective February 1, ,. W 1, the N RC, granted the Company,s tial loss is provided by private insurance with the remaining
. exemption request that the nuclear property ir,suranc e( ov -
$ 560 m.llion i be.ing provided by a mutual insurance (om-
. . erage be reduced from $ 1,06 billion to $ 169 nu,llion, pany, Nuclear Electnc insurance L.imited. Under this insur.
ance policy NEllll, the Company is also subject to
- 3. CapitalStock 1990 IW9 h Shares A nmunt Shares Amount f Ihousands (Thousands of Dollam of Dollars)
Cumulatlie preferred stuk, $100 par s alue: Authorved 3,(MN),tMK) 3 0u0,000 1ssued and outstandmg: Not sobrect tomandators rtxlemption: 4.20%enn IIHl lMM) $ 10,(MH) 100.000 i 10 000 44% sene5 0ndudes $ 7.500 premiumi 175,tMM) 17,50M 17 5.0t n_) 17.508 4',/h senes 65,tMM) 6.5M M .(W ) h.500 4.64% he'ies IM),(N M) 16,lH)O 160 000 16 000 4 90% senn !!0,tMK) !!,0f M) 150B00 15.000 4 SO% 2nd >enes 150,tHM) 15,(MM) 150 (XX) 15JXK) 7.13 % serias 250.tN K) 25,000 250,000 21000 Total 1,050,lNM) $105,tM13 1,050.000 $10M108
$ubiect to mandatory tedemphon:
7.50% series 22M,ono $ 22.htM) 240 000 $ 24 000 8 40 benes _ 261,440 26,144 275.200 2?.520 4M9,440 48,944 515.200 51.320 Less. Prefeued stod subjectio mandator, redemption githm one 3 ear q$,760) 12,576l d L7bOf Q.576) Total 46A6M0 $ 46,368 489.440 $ 48,944 Cunmlatit e preferred stuk, $25 par s ulw; Authorized 4,000,0iM) 4 000 000 hsued and' atstandmg-Not subject to mandatory redemphon: 8 40% series 1,400,tuM) $ 35, tug) 1,400,000 $ 35000 Cornmon stock,$5 par s alue: Authorimi i 40,(W)0,000 80.000.000 luued and r$utilandmg $4,320,248 $271,Mit 52,807.221 $264.0.16 premium on common stod 479,54M 454.260
$751,149 $ 718.296
- == . u.- _ _
. p 9
NOTES TO CONSOLIDATED FINANCI A L STATEM ENTS Cominued Miic Service C<vnpany ofCdorado urid Subsidiaries Changes in common stock and premium on common stock for the three years ended December 31,1990, are as follows: O housandud Dollaro Astruge l'remium Prke Per Comnwi on Common Share Wck Stuck Balan(eJJnuary 1,1988 62.283 $447. 20 1.305 share adiustjnent , _
$i7.18 6 17 Balance. December 31,1988 162.289 447,437 348.733 shares iuued under the Dn idend Remsestment f1an $24 s3 1.744 6,81i bl 5 sharc adil.qstment $ 21,7s 3 12 Dalance. December 31.1989 2h4.0 % 454.260 197.862 shares inued under the E mployees' SaWnp Plan $2s 13 989 3.'m 3
....!dN!.{ shares iwued under the Dn idend Reinvestngnt Plan $ 21.2n 6,s76 21.303 Balance, De emlier 31,1990 $ 271,6m $ 479,548 P " " " "'"""* *P ""
On February 26,1991, the Company's Board of Directors per share plus accrued dmdends to the date set for pur-dec lared a dividend of one common share purchase right chase. No other changes in preferred stoc k occurred in the (right) on eac h outstanding shs.re of the Company's com-mon stock. All future common shares issued will comain this right. Each right stipulates an initial purchase price oi $ 35 The preferred stock may be redeemed at the option of the per share but also prescribes a means whereby the resulting Company upon at least 30, but not more than 60, days' effect is such that, under the circumstances described below, notice in accordance with the following schedule of prices shareholders would be entitled to purchase additional plus an amount equal to the accrued dividends to the date shares of common stock at 50% of the prevailing market fixed for redemption: price at the time of exercise.The rights are not currently
$100 par value:
exercisable, and w ould become esercisable if certain events occurred related to a person or group acquiring or attempt- Not subject to mandatory redemption:
. ing to acquire 20% or more of the outstanding shares of 4.20% series: $ l o I; 4 %%eries:5101;4%ueries:
common stock of the Company. $ 101 ; 4.64%eries: $ 101 ; 4.90%eries: $ 101 ; 4.90% 2nd series: $ 101; 715%eries: $ 101. In the event a takeover results m the Company being merged hito an acquiror, the unexercised rights could be used to pur- Subi ect to mandatory redemption: chase sha es in the acquiror at 50% of market price. Subject 7.50%eries: $ 103.25 on or prior to August 31,1991, to certain conditions, if a person or group acquires 20% but reducing each year thereafter by $0.25 per share until no more than 50% of the Company's common stock, the August 31,2003, after which the redemption price is Compary's Board of Directors may exchange each right $ 100; 8.40%eries: $ 10150 on or prior to July 31, held by shareholders other than the acquiring person or 1991, and reducing each year thereafter by 50.25 per group for one share of common stock tor its equivalentL share until July 3 I_, 2004, after a hich the redemption if a person or group successfully acquires 80% of the Com. P' pany's common stock forcash, after tend ring for all of the in 1991 and in each year thereafter, the Company must common stock, arid satisfies certain othe. conditions, the offer to repurchase 12.000 shares of the 7,50%eries at rights would not operate. The rights expire on March 22, 5100 per share, plus accrued dividends to the date set 2001 l however, the right3 may be redeemed by the Board for repurchase, and 13,760 shares of the 8.40%eries at of Directors for one cent at any time prior to the acquisition $ 100 per share, ob.:necrued dividerds to the date set of 20% of the common stock by a potential acquiror. for repurchase. Lonsequently, this preferred stock to be At the May.1990 Annual Meeting of Shareholders, the redeemed was classified ay preferred stock subject to mandatory redemption witain one year m the Decem-Company's shareholders voted to iricrease the number of authorized shares of common stock from 80,000,000, h" 3 I ' ' " " "* "" " to 140,000,000. $ 25 par value: During each of the years 1990,1989 and 1988, the Com- Not subject to mandatory redemption: l panyrepurchased 12,000sharesof the 7.50%curnulative 8.40Meries: $ 25.75 prior to December 1,1991, and I preforred series and 13,760 shares of the 8 AO% cumulative $ 25.25 on or after that date. 40~
4, IAmg. lerm Debt (thousand,of Dollam 1990 1989 Public Service Company of Colorado: First mortgage bonds: 4 %% series, due October 1,1991 $ - $ 30,000 4%% series, due March 1,1992 8,8(H) 8,800 8.95% series, due May 1,1992 75,000 75,000 4%% series, due lune 1,1994 35,000 35,000 5 %% series, due May 1,1996 35,000 35,000 3 %% series, due July 1,1997 35,000 35,000 6%% series, due July 1,1998 25,(HHI 25,000 8%% series,due September 1,2000 35,(HW 35,000 7%% series,due February 1,2001 40,000 40,000 7%% series,due August I,2002 50,(HH) 50,000 7%% series, due June 1,2003 50,(HH) 50,(100 9 %% series,due October 1,2005 49,500 49,500 8%% series,due November 1,2007 50,000 50,000 9%% series,due October 1,2008 50,000 50,000 9%% series, due July 1,2020 75,000 - 13% series, due March 1,2015 - 35,500 Pollution Control Series A, 5%%,due March 1,2004 24,000 24,000 Pollution Control Series 8: 7%%,due December 1,1995 2,500 2,500 8% due December 1,2004 35,000 35,000 Pollution Control Series C: 7%%,due Octcher 1,2004 15,tHH) 15,000 7 %% due October 1,2005 1,960 1,960 7 %% due October I,2006 2,105 2.105
- 7 %% due October 1,2007 2,260 2,260 7%%,due October 1,2008 2,425 2,425 7 %% due October 1,2009 26,250 26,250 Pollution Control Series E, 9%% dueMay 1 2013 42,000 42,000 Pollution Controi Series F, 7 %% due November 1,2009 27,250 27,250 Unamortized premium 615 688 Unamortizeddiscount (13,920) (10,155)
Capital lease obligations,14.65% due in installments through April l,1995 2,202 2,695
$782,947 $ 777,778 4i
NOTES TO CONSOLIDATED FINANCI A L STKrEM ENTS comimmi PuNie Service Compmo efColoradoimdSulnidiarin
< t nouwxh of Douam 1990 1989 Cheyenne Light, f uel and Power Company:
7'4,% first mortgage bonds, due April 1,2003 $ 4,000 $ 4,000 10.70% unsecured notes, due September 1,1995 8,000 8,000 Western Gas Supply Company: Unsecured promissory notes: 7 '//S. rlue December 31,1997 20,000 20,000 10.35% due in instaliments th.ough Det ember 1,1999 1,667 5333 11.60% due May 1,2015 5,000 5,000 12.875% due May 1,2025 10,000 10,000 Unamortited discount (305) ( 117 > 14'30 Welton, Inc. 12,50% secured promissory note. due in installments through March 1,1948 8,906 9,792 13.25% secured promissory note, due in installment ' through Oc tober l ,2016 32,709 32,868 Fuel Resources Development Co.: Unsecured note, due June 30,1992, interest rate fluctuates with the New York f ederal f unds rate (5.93% at Dec ember 31,1990 7,000 - Bannock Cen%r Corporation: Unsecured note rNelune 30,1990, interest rate fluctuates with the New York i ederal funds rate - 21.425 8% mortgage note, due in installments through lanuary 1,1992 200 250 PS Colorado Credit Corporation: 8.30% to 8.75% unsecured notes, maturing lanuary 16,1991 to february 5,1991 - 10,000 Natural fuels Corporation: Capitallease obligations,8%% due in installments through Der ember 31,199 75 -
$N83,199 $ 904,129 42
E The Company registered $ 150,000,000 in f trst Mortgage 31,1990 BCC is in the proc ess of securing other fir,uncing Bonds w ith the Securities and E xchange Commibion (SE C) arrangements. in November 1986. In July 1990, the Comp my istued the As of December 31,1990, PSCCC had in place a program to remairJng $ 75,000,000 of suc h bonds at 9h% due luly 1, ' hs pr amnw wnerm n tes, u ith maturities from nine 2020 In October 1990, the Company filed a registration statement with the 5E C relating to S 500,000.000 principal rn nestownyears.upman ainwntof 5100DN,0Nwt\ , amount first Mortgage Bonds of w h:ch $ 200 000,000 was stangng at any one Orne A@wnber 31.1990, P5LCC had issued $49,500,000ofits medium term notes,of which subsequently des.ignated for a med.ium7t erm note program.
$ 39,500,000 has e been redeemed. At December 31,1990 Subsequent to year end, $ 55,000.000 m medium term g ,y
, g.h o dM 10,00020Md notes were issued as shown below. The Company will c on-
$ 35,000,000 in medium term notes, respectiveh, of w hich tinue from time to time to offer suc h bonds based on market
$ 10,000,000 and 5 25,000,000, respec tively, w ere due to conditions and other factors.
mature within one 3 ear. Principal Interest Rate Maturtt) Date h0,(Un con 6.55% 1/1 U91 an a a pmp e o panyan su d - t 5200 000 8 82% Ui s'96 aries, other than expressly excepted propertv, are subject to 10 000.000 8.3a% U1T94 the liens securing the Companis hrst Mortgage Bonds or 10 omooo _ _ _ Br5% __ _ Un ?/94 the mortgage bonds and notes of subsidiaries. In March 1990, the Company redeemed $ 35,500,000 of The aggregate annual maturities a nd sinking fund require-the 13% first Mortgage Bonds, due March 1,2015, paying ments during the five s ears subsequent to Det ember 31, a redemption premium of $3,766,000.'Ihis redemption 1990 are: premium as w ell as the unamortized debt expense attiib- Year Maturtiles Mnking iund Requirenwnis 1otal utable to the 13% bonds are being amortized through 2003 ty9i y: a mio y 69 so yg923o00 as authorized by the CPUC. t992 9 i 44Bano 4noivoo % onuoo 1993 J 646 000 : 605,000 L 101.000 in addition. BCC's unsecured note payable was not t994 3197 4 ona ass ooo o n9 moo extended beyond December 30,1990. On lanuary 2,1991, 199s n i 02.000 uss noo i7.n 7.ooo a $ 23,500,000 unsec ured note, due March 25,1991, varia-ble interest rate, w as issued. in the interim, although not The Company expects to satisfy its sinking fund obligations reflected in the consolidated financial statements, an inter. through the application of property additions, and Cheyenne company note receis able/ payable betw een the Company expects to satisfy $ 60,000 of its sinking fund obligations and DCC for $ 23,500,000 at 9.5% was outstanding at December annually through the application of property additionx 3
- 5. Notes Pu3able and Commercial Paper information regardmg notes payable and commercial paper for the years ended December 31,1990 and 1989 is as follows:
ahuume of Doltw 1990 1989 Notes payable to banks (weignted average interest rate 8.54% at December 31,1990 and 0% at December 31,1989) $ 68 - $ 18 Commercial paper (weighted average interest rate 9.06% _at December 31,1990_and 9.00% at December 31,1989) 145.100 153,190
$213,833 $ 153,208 Maximum amount outsianding at any month.end during the period $254,230 $ I 65,000 Weighted average amount (based on the daily outstandmg balance) outstanding for the period (w eighted average interest rate 8.44%
for the year ended December 31,1990 and 9.26% for the year ended December 31,1989) $163,736 '.,142,225 41
NOTES TO CONSOLIDATED FINANCI AL STKrEMENTS Comimed noNic Sm kr Comprmy of Colorado <mdSidnidiaries ti, Ikuk l.ines of Credit and Compensating llank llalances pany has agreed. upon conclusion of the rate case, to a rate adjustment which will recognize toe difference, if any, between Anangements for committed bank lines of credit totaled the new rates resultingimm the complaint case and those in
$ 150,000,000 at December 31,1940 and 1989, and w ere effec t from November 27, l 440 theough September a M 9 L maintained entirely by fee paymenun lieu of compensat-ing balances The unused committed lines of credit at December 31, t 990 and 1989 were $ 136,000,000 and Purchase Requlrements Coal: At December 31,1990, the Company had in place
$150,000,000,respecthelv Certainof theagreements for long rm contracts for the purchase of coal for existing these credit lines require that investment grade status be p n plants through 1997 a nd for the paw nee Steam Elec-maintainal to ensure commitment. These bank lines of tric Generating Station Proposed Unit 2 from its completion credit are primarily used to support the issuanc e of commer-through 2013. The minimum remaining quantities to be pur-cial paper by the Company and PSCCC, but also allow for c hased under these contracts total 104 million tons, The coal direct bortowing thereunder.
purchase pri< es are subject to periodic adjustment for infla-Arrangements for uncommitted bank lines of credit totaled tion and market conditions. Total estimated take or pay obli.
$ 150,000,000 at December 31,1990 and $ 200,000.000 at gations, based on current prices, were approximatch $81 <
Dec e.nher 31,1989, The unused uncommitted bank lines of million at December 31,1990. crecht at December 31,1990 and 1989 were $95,000,000 Nawrd Ga s: The Company and its regulated subsidiaries and $ 200,000,000, respectively. The Company and its sut" have entered into long term ( ontracts espiring through 2004 sidiaries generally may borrow under uncommitted preap~ for the puchase oinatural gas in anticipation of future proved lines of credit upon request; however, the banks have requirements. In genera!, purchase prices under these con-no firm commitment to make such loans. tracts are based on market price formulas, Total estimated On february 8,1991, the Company and PSCCC jointly take or pay obligations, based on current prices, were $ 662 entered into a credit facility with several banks providing million at December 31,1990.
$ 300,000,000 in bank lines of credit. The facility consists of 5150,000,000 in available commitments and $ 150,000.000 Purchasedponer: The C,ompany and Cheyenne have entednto agmwwnMor y achased power to meet sys-in deferred commitments. The available commitments will tem i ad and energy requirements, to replace generation be used primarily to support the issuance of commercial r m Company-owned units under maintenance and out paper by the Company and PSCCC and are as allable for direct borrowing thereunder. The deferred commitments are "#' "P"
- P" " N W""" "8 ""* "
""" "" " .l. These agreements espire on standby committed lines of credit that can be activated with E"N"I five business days notice. Generally, the bankc as partici.
"#" "' d ""8 * #' D " '""U purchased is determmed by contracts, which have been pants in the facility would have no obligation to continue accepted for tiling by the F ERC, providing generally for tneir commitments if there has been a material adverse change in the business or financial condition of the Com. mw@y mm asqwwm uppys unda pany. The facility, w hich matures February 6,1992, replaced
** # # "* """" "C bad on md mnuaddotal payments associated with the $ 300,000 000 individually arranged bank lines of credit in effect at the time this facility was entered into. wch mnuaas wap8 ndog 99m $ 172 million O 989) and $ 128 million O 988). The following tabit show s the fixed portion of c ommitments under these contrac ts
- 7. Commitments and C,ontingencies able pmvided pown is available) for each of the next Resenue Subject to Refund five years and in the aggregate, On July I 8,1990, the Company, the Colorado Office of Con- %,,gm,w
. sumer Counsel (OCCt and the staff of the CPUC reached a ~
Jn unembern ~~ Joint stipulation agreement on procedural issues for a pro' PFu 5 D3Sa posed rate case. As agreed to, the Company filed a rate case w92 1 mas on January 31,1991 in determination of the Company's rev- 1993 is4A39 enue requirements. An CCC complaint, which was filed "* M 980 March 29,1990, has been consolidated into the rate case. The complaint contends, among other things, that the Com- g-- - - gg3 pany s authon, zed 14.4% return on equity is unreasonable. Also as agreed, the Company will refund amounts earned in in addition, the Company has other long term purchased excessof the 14.4% regulatoryauthonzation,if any,for the onnacts expiring through 2017 that include firm period January 1,1990 until November 27,1990. The Com-pany does not believe earnings during this period w ere m d e mmmitments. These contracts similarly provide excess of regulatory authonzation. In addition, the Com-W o Mybysellersof theircosts. Estimated firm 44
commitments (payable provided power is available) under specified levels. The Company is currently meeting the these contracts total $ 12 billion. emission standards placed on 502 through the use oflow sulfur ( al The Company w ill be rec,uired to modify ( ertain Historically, all minimum coal, natural gas and purchaseci boilers to reduce NOx emissions It is anticipated that under power requirements have twen met, nt re@ogimi#mngoWne d b@ Company wuuld be recovered from its customers. Miscellaneous Purchases: Commitments made for the pur-chaseof various items of plant and equipment aggregated On Octoter 7,1988 J e results of the Metro Denver Brown approximately $ 134 million at December 31,1990. Cloud Studyaitv.Ch a ten point recommendation. were released by the G ivi .nor of the State of Colorado. In response. I' ort St. Vrain the Company wih empt t 3 reduc e 50; emissions 50% See Note 2 for certain contingenc ies relating to fort StNrain. by applying 502 rwactiea r & Sty on all of its major metropolitan art a ge, v / c rec'ut e NOx Customer Accounts Receivable emissions 20% bv mod' i.3 . , e Angunits by the The Company is required to provide service and grant credit end of 1992. to customers within its service territory. The Company may require security deposits prior to providing service to cus- 1, casing Program tomers depending upon an assessment of credit worthiness. The Company has in place a leasing program w hich The Company has review ed its customer base for c oncentra- ncludgs a pmum whemby the Company indemnifies the tions of credit risk and has determined that no individual
""*' w ch nHght arMmm We acqus O n, use, uhspos. ition of theleased property.
customer or group of customers engaged in similar activities represent a material concentration of cr edit risk to the No provision has been made in the financial statements (cr Company, any of the above commitments and ( ontingencies. Environmental 8. Postretirement lienefits Lowry Lanchi!!: The Lowrv Landfill in southeast metro-The Company and its significant subsidiaries maintain politan Dens er has beerdesignated by the Environmental a noncontributory defined benefit pension plan covering Protection Agency (E PA) as a Superfund site pursuant to th ComprehensiveEnv,ronmentalResponse i Compensation, i l I J bed os and Liabilits Act tCERCL A). Under CERCL A, the EPA notified mp p,yyarso e c , uptoa maximum f 35 years, and average fmal compensation.On January 1,1991, an Potentially Responsible Parties (PRPs) of their potentiallia. bility for the cleanup of the site. The Company, which used dmyndment became effective whic h removed the 35 year Im.utadom the site for disposal of trash and neutralized liquids ger.er-ated in its boiler cleaning process, has been named along The Company and its subsidiaries' funding policy is to con-with many others as a PRP at the Lowry Landfill. The EPA has tribute annually, at a minimum, the amount necessary to sat-begun its remedial investigations and feasibility studies at isfy the Internal Revenue Service funding standards. The net the Lowry Landfill for the purposes of identifying the appro- pension expense (credio in 1990,1989 and 1988 was com. priate method of cleanup, its attendant cost, and the alloca- prised of: tion of the cleanup cost among various PRPs.The Company rmonsanduanam is actively participating in the Lowry Landfill De Minimis pno im im Group which was organized as a result of the EPA's declara- 3;,;g,y 3 3 uu 3' 3,9;p i ' 3na tion that it would seek a de minimis settlement at Lowry intereu wu on prowaed j - Landfill.The EPA requested that the PRPs organize lhem- benent obimauon 3Mm 28.sv 2uan i selves to negotiate a settlement for the PRPs whose contrib+ L"" *"u o" P d" i d"e'$ l 773 C4 70D 07>?!3) I ^'""'"""""#'*"'""d""" tion of waste at the Lowry Landfill is minimal in volume and toxicity. In addition to the Lowry Landfill, the Company has ,",[nN'" """' identified several sites where cleanup of hazardous waste sonaardmom we <mm op.n may be required The Company fully intends to pursue the Other Hems 08RW FL8 m ))86 recovery of all costs incurred for such projects through Net pendon espense insurance coverage and/or the regulatory process, kredm 5 2a 5 UMat 5 n,sm Clean Ah On November 15,1990, President Bush signed intolaw the Clean Air Act Amendments of 1990 aimed at lowering the acidity of rainfall in the United States. The Amendments require coal burning power plants to reduce sulfur dioxide (sod and nitrogen oxide (NOx) emissions to e
NOTES TO CONSOLIDATED FINANCI AL STATEMENTS Cmrimord haMic Service Company ofColorado emdSubsidiaries A comparison of Ihe actuarially computed benefit obliga- are stated at fair value and are comprised primarily of corpo-tions and plan net assets at December 31,1990 and Decem- rate debt and equity securities, a real estate fund and govern-ber 31,1989, is presented on the following table. Plan assets ment securities held either directly or in c ommingled funds. abouwnw Douam 1990 1989 5tu$ial present value of benefit obligations: Vested $ 275,487 $ 271,445 Nonvested --. - 23,088 21,817 298,575 293,262 Effect of projected future salary incteases 87,333 79,574 Projected benefit obligation for service rendered to date 385,908 372,8 % Plan assets at fair value f 392,913) (406,551) Excess of plan assets over projected
- benefitobligation 7,005 3 L715 Unrecognized net loss (gain) 27,550 (1,660)
Prior service cost not yet recognized in net periodic pension cost 12.474 9,916 Unrecognized net transition asset atJanuary 1,1986, being recognized ___over 17 yea _rs.. _ _ ,. .__ (44,084) __(47,758) Prepaid pension asset (accrued
,.pensionliabfity) $ 2,945 $ (5,787)
Significant assumptions used in determining net periodic either early or normal retirement age w hile working for the pension cost and the projected benefit obligation w ere: Company or its subsidiaries. T he cost of providing health care and life insurance benefits to active, retired and dis-im im im abled employees amounted to $ 30.4 million, $ 27.3 million ULountrate 'an ~ 83% 9 t>% and $ 26.2 million in 1990,1989 and 1988, respectively. hpeded lonperminoease in compensanon lewi sw sn iss Ihe 1990 cost of providing these benefits was $ 7.5 million hpened we@hted awmge for the 2,338 retired employees and $ 22,9 million for the longam tre oi remn, 6,709 active and disabled employees. The prior years cost on assets 11 % u% 11 % of roviding these benefits for the retired employees (2,284 Variances between actual experience and assumptions for in 1989 and 2,250 in 1988)is not 3eparable from the cost costs and returns on assets are amortized over the average of providing benefits for the active and disabled employees i remaining service lives of employees in the plan. t6,623 in 1989 and 6,643 in 1988). During 1966, the Company and its subsidiaries oftered to in December 1990, the f inancial Accounting Standards l. i employees, age 55 and older with 20 years or more of serv- Board (FASB) issued Statementof Financial Accounting
. ice, a special incentive for early retirement in the form of Standards No.106 " Employers' Accounting for Postretire-increased pension benefits, to be paid from the pension trust ment Bene % Other Than Pensions", whlch establishes the fund, and a one time cash bonus. Approximately 550 accounting - b porting 2 standaicifor postretirement bene- - employees elected to retire under this program. The cost of fits other than pensions. The statement requires the accrual, this progra m, determined in accorda nc e with Statement of during the years that an employee rend ars service to the Financial Accounting Standards No.88 " Employers' Company, of the expected cost of providing postretirement Accounting for Settlements and Curtailments of Defined benefits to the em%oyee and the employee's beneficiaries Benefit Pension Plans and for Termination Benefits", was and covered dependents. The statement is effective for fiscal l approximately $ 25.2 million. This cost is being amortized to years beginning after December 15,1992, with early udop-l pension expense over 4.3 years as authorized by the CPUC. tion encouraged. The Company has not yet determined ,
when the standard will be adopted, or how it will be imple- 1 In addition to providing pension benefits, the Company and ' mented, nor has the Company quantified its financial impact its subsidianes provide certain health care and life insuranc e when ultimately adopted. Ahhough the effect of adoption benefits for rehred employees. A sigmficant portion of the has not been f ully determined, due to anticipated future reg-l employees become eligible for these benefits if they reac h ulatory treatme,t, the Company does not expect adoption 4 to have a material effect on results of operations. t
. . - . .. - _ _ __ - . . . - ~ _ _ _ - . - . - . . - .__ . . _ _ _ . -
- 9. Income Tn Expenw incomelax expense consists of the following:
O housanu Dane,)
;'190 1989 1988 Current income taxes.
Federal $ 40.742 $ 30,174 5 61,517 State
- . - _ - - -. - ~. - --
3,931 4430 14,091 44,673 34,804 75,608 Deferred income taxes (benefits 1 related to: Contributions in aid o(c onstruction (3,300). (11,082) - Accelerated depreciation 23,893 19,064 23,028 Net unbilled revenues (2,780) (14,784) (8.332) fort St. Vrain plant abandonment 327 42.647 - I ort St. Vrain defueling and decommissioning 21,596 8,052 (25,I41) Alternative minimum tax (5,114) (2,1801 - _ Other book tax timing different es (335) (4,097) 2,224 34,2M7 37,020 (8.221) Investment tax credit, net of amortization (4,'182 ) (5,267) (6,342) Totalincon e taxes $ 73,978 5 66,557 $ 61,045 Deferred tax provisions are not recorded on certain book. tax During lune 1W9, the Company and its regulated timing differences. As of Dec ember 31,1990,Ihe cumulative subsidiaries revised their estimate of the deferred taxes to be net amount of such timing differences was $ 364,724,000. recognized as a result of taxable customer contributions in The tax effect of this amount is not recorded c urrently as aid of construction under the Tax Reform Act of 1986, The regulatory commission procedures will result in such costs recognition of such deferred tax assets for the periodlanuary
- being c.harged to customers when the timing differences 1,1987 theough lune 30,1989, which had not previously . reverse and the related taxes are paid, been provided for, reduc ed 1989 total income tax expense and increased net income by approximately $ 16.9 million. . As a result of the Tax Reform Act of 1986, the L.ompany .
determinesits income tax liability to be the greater of regu- .." ^ " ' " E "S PN"*' ' "" " ' " * "* netted against deferred ta x liabilities f ar income tax or alternative minimum tas ( AMT). As of. December 31,1990, the Company has recorded an excen
- AMT liability over regular tax liability of approximately $ 7.3 million.This excess becomes a credit which may be applied against future regular tax liabilities.
4 1 i ,p
NOTES TO CONSOLIDATED FINANCI A L STATEMENTS cominunt
' Public 5avice Civnpany ofColorado und Sulnidiaries A recon (lllation of the statutory U.S. income tauates and - the effective tax rates is as follow s:
ahousamhofOonso 1990 1989 1988 Tax computed at statutory rate on pre-tax a(counting income $74,842 34.0% $ 73,235 34.0 % $63.265 34.0 % increase (decrease)in tax from: Difference between tax and book depreciation (1,215) (0,5) 1,067 0.5 224 0.1 Allow ance for funds used during construction (2,122) (1,0) (1,226) IO M (290) (0.2) Amortization of investment tau redit (5,195) (2.41 (5,378) (2.5) (6,889) (3.7) State income taxew net oi federalincome tax benefit 2,588 1.2 3,060 1.4 8,644 4.6 Customer contributions in aid of construction 1,321 0.6 (7,794 DM 8,263 4.5 Amortization of bond call premium 293 0.1 226 0.1 226 0.1 Fort St.Vrain plant abandonment 548 0.3 10,908 5.1 - - Net unbilled revenues ' (1,020) (0,5) (2,178) (1.01 (3,609 (1.9) Other-net 3,938 1,8 (5,363) (2.51 (8,7891 (4.7) Totalincome taxes $73,978 33.6% $ 66.557 30.9 % $ 61,045 32.8% in Dec ember 1989, the F ASB issued Statement of Financial act ounting and reportmg standards to recognize tax liabil. Accounting Standards No.103 " Accounting for Income ities and awets that result from an enterprise's activities during Taxes-Deferral of the Effective Date of FA5B Statement ene current and prec eding years. T he I ASilis currently No. 96" w hich postponed mandatory adoption of Sta'ement re-es aluating specific provisions of SFAS 96 and intends to
-of Financial AccountingStandards No.96 " Accounting amend the standard. The C omvany believes application for income Taxes"(SFr\S 96) to fiscal years beginning af ter of the new standard will not signi0cantly impact the Company's December 1 S,1991, SFAS 96 establishes new financial reported net worth in the year it is adopted.
- 10. Supplementury income Statement luformation chousamh oi Dee 1990 1989 1988-Taxes (other than income taxes)
Real estate and personal property taxes $41,307 $ 39,567 $34A03 Social security taxes 19,951 18,237 17,092
' City and state use taxes 8,625 7,540 5,778
,_Miscellaneous taxes _ 5_,H.23_ _ _ _ 6,324 6,318
$75,706 $ 71,668 $ 63,791 Charged:
Directly to income-Operatingexpenses $70,033 $67,430 $60,434 i Other 124 I29 175 20 PIOPCUV pjan(anpiluipment and various other accounts 5,549 4,109 3,182
$75,706 $ 71,668 $63,791 l
l l 48
- 11. Segments ofIlusiness Segment informatlcn for the year ended De( ember 31,1990 k as follows:
muiusanau,1 nonam 1:lectric Gas Other 'lotal Operating res enues $ 1,14 5,915 $ 561,' 12 $ 26,312 $ 1,7 3 3,939 Operating expen+s, eu luding deprec iation ai d in(ome taxes 806,287 503,41 > a,326 1,115.028 Depreciation 79.950 23.669 2,908 106,527 lotaloperating expef1 sed 886,237 527.084 8,234 l,42I,555 Operating income' $ 259,678 5 34,628 $ 18,078 $ 312,384 Plarit tonstruction expenditures" $ 150,780 $ 105,231 $ 5,208 $ 261,221 Ideetifiable assets, Det ember 31,1990-Utility plant" $ 1.919,301 $ 569,108 $ 100.852 $ 2.609,261 Materials and supplies $ 60,404 5 11,486 $ 29 71,919 f uelinventory $ 33?l9 $ -
$ 208 33,427 Gas in underground storage $ $ I 3,701 $ 13,701 Other c orporate assets 501.934
$ 3,2 30,24 2 Segment information for the year ended Det ember ll,1989 is as follows:
m-ands of oon,si Electr ic Gas Other Total Op~aHng revenues $ 1,I 39,471 $ 577,282 $ 2 3,9 I J $ 1,74 U,666 0, etating expenses, culuding depreclation and income taxes 813,128 il l,l 21 829 I,125.080 Depreciation < 11,658 20,849 3,324 102,831 Total operating expenses
- 891.786 531,972 4,15:1 1,4 2 7,9 I I Operaung income' $ 247.685 $ 45,110 $ 19.760 $ 31?,755
' Plant construction expenditures" $ I12,750 $ 54,115 $ 7,5 31 $ 174,4111 Identifiable assets, Dec ember 31,1989-Utility plant" $ 1.886.444 $488,592 $93.!O7 $ 2,468,14 3 Materials and supplies $ 66,857 $ 10,04 5 5 35 76,917 Iuelinventory $ 34,25i $ -
$ 117 31,368 Gas in underground storage $ -
5 16.092 $ - 16,092 Other corporate assets 449,397
$ 3,044,937
- Befom inmv ta ses
" Includes alka ation oi tornmon utihty propeny 49
NOTES TO CONSOLIDATED FINANCI A L STATEMENTS cominued hablic Service Cornpany of Colorado and Subsidiaries Segrnent information for the year ended Dec ember 31,1988 is as follows'. Oham.andsof Dona m l'.lectric G as* *
- Other 'lotal Operating revenues $ 1,115,964 $ 591,493 $ 22,984 $ 1,73(1141 Operating expenses, excluding depreciation and iocome taxes 827,185 519,423 2,568 1,349,i76 Depreciation 77,913 19,764 3,264 100,941 Total operating expenses' 905,098 539,167 5,832 1,450.117 Operatingincome' 5 210,866 $ 52,306 $ 17,152 $ 280,324 Plant construction expenditures" $ 118,079 $ 43,322 $ I,405 $ 162,806 ldentifiable assets, December 31,1988-Utility plant" $ 1,859,498 $ 464,817 $ U9,09; $ 2,413,410 Materials and supplies $ 58,546 $ 10,924 $ 40 69,510 Fuelinventory $ 27,593 $ -
$ 165 27,758 Gas in underground storage $ -
$ 14.681 $ - 14,681 Other corporate assets 459,083 52,984,442
'Before income ta ses "Indude* alloc ation of (ommon utility properts
"'Cas operahng res enues and operahng npenses hase twen restated io retlett a nwomn the ta aiment or gauefunduet en ed h om nupphers these thanges had no cifect on operating Mcome m e Note 11
- 12. Operating Leases The Company and its subsidiaries maintain operating lease agreements for equipment and facilities used in the normal e
course of business. The majority of these ! eases are under a leasing program that has initial noncancelable terms of one year, Other operating leases have various terms and may be renewed or replaced. Rental expense for the years ended December 31,1990,1989 and 1988 was $ 18.4 million,
$ 11.0 million and $ 5.2 million, respectis ely. At December 31,1990, future minimum rental payments applicable to nonc ancelable operating leases were as iollows:
, iThousandsoiDollars.
Years endmg Dec ember 3 l 1991 $ 20,50n 1992 1tt u81 1993 15J46 1994 12.0 Fl 1993 ',799 N?fid thertyfter 45,240 Total mimmum !eaw p ,mec. $ 119.001 50
- 13. Quarterly I'inancial Data (Unnudited)
The following summarized quariedy information for 1990 and 1989 is unaudited but includes all adjustments (consisting only of normal recurring accruals) which the Company considers necessary for a fair presentation of the results for the periods. information for any one quarterly period is not necessarily indicative of the results which may be expected for a twelve month period due to seasonal and other factors. _ . . . _ . _ . _ _ _ - _ _ - . _ . _ _. . - . _ _ - . _ _ .1R"t*"dM'"?P'? 'hd'* d:!'*] jp0JJy,ec htonths Ended _ , _ __ _ March 31 _ June 30 . September 30 __I?ccember 31 Operating revenues"' $513,322 $418,669 $ 364,380 $ 437,568 Operatingincome $ 66,197 $ 52,622 $ 57,114 $ 62,473 Net income $ 41,289 5 30,188 $ 34,259 $ 39,408 Earnings available for common stockm $ 39,162 $ 27,061 $ 31,149 $ 36,332 Average common shares outstanding 53,072 53,440 53,802 54,188' {ay,@gper averagggomypnplaygf
._ _ , __, _ _ __ ,, , _ , _ _5,0.f 4._,_, _ _ $0 p _ _
$ 0,5 8_, ._ _ J_0fg 5" Operating revenues and ga port hased for resale espense for the three months ended Matt h 31, jur.e 30 and september 30 hase been iestated ta reflect a revision in the treatment of pn refunds received from supphers These revisions had no effect on income Mee Note 1 L n Due to rounding, quarter ly f:guas do not add to annual total, (Thousand3-except per share rlata)
!981.hr$p,lpu@5Endnl _ . _ _ . _ _ _ _ , _ _ _ _ _ _ _ _ .
.Ma,rch 31 June 30 September 30 D_cecmher 31 Operating revenues $544,669 $ 389,579 $ 382,989 $423,429 Operatingincome $ 68,196 $ 64,503 $ 46,821 5 66,678 Net income $ 43,672 $ 39,478 $ 23,539 $ 42,151 Earnings available for common stock'" $ 40,494 $ 36,300 $ 20,378 $ 39,024 Average common shares outstanding 52,458 52,458 52,570 52,749
- Earnings ocr average common share $0.77 $0.69 $0.39 $0.74
<"Due to rounding quartedy figures do not add to annual total.
l l l l. 5i d
SHAREHOLDERINFORMATION noblic Service Cmpimy of Colorado and Subsidiarles The Ccenpany's common stock ($ 5 par value)is listed for on the dividend payment date. Common shareholders, trading on the New York, Midwest and Pacihc 5tock whose shares are registered in names other than their own, Exchanges under the ticker symbol *PSR." Quotes may be may participate in the DRP for the reinvestment of divi-obtained in daily newspapers where the common stoc k is dends,ptavided thebroker a fiduciarywhoholdssuth listed as "PSvCol"in the New York Stock Exchange listing stoc k in nominee name is a liling to participate in the DR P, taNe Participants may also ;avest optional cash payments through Year
'lotal Vntu!ne Asernge Dail
,3 hiume the DRP in amounts ranging from a minimum of $ 25 per 199n 44#n J 00 U4m payment to a maximum of $ 100,000 per year. The same 19e9 n. m ooo i 48.34 s amount of money need not be sent with each payment, and
[ , y there is no obligation to make an optional cash payment each month. Optional c ash payments must be rec eived by common Shares Shareholders the 20th day of the month. Such payments received after the Year , outstanding _ common PreWred 2()th day of the month will be deemed, for reinvestment pur-1990 54 J 20,248 Ss 94s 4. !! 3 poses, to has e been received in the next month. 1989 52.60L2 a 56ms 4.4% 19aa 52Asta7s , 4,rm The purchase price of shares a< quired with optional cash
~39.256-g gg g T hree series of cumulative preferred stoc k are actively comrnon stock, as reported on the consolidated tape on the traded (see chart below). All other series are not actively investment date. Common stock purchavd directly from the traded and market prices are not publisheci. Company will be crechted to the participants' accounts as of Sales Where lhted the21stdayof themonthor,if themarketisclosedon such dhEd100 par 5uhl A'merican SIdkiEhange day, the next day on whic h trading occ urs.
7.15M5100 par # N New York $tock hchange A pospectus describing the DRP and enrollment informa-8.40N$2s panalud New r k a W ained from the Shareholder Services Depart-ment by writing or by calling (MD 635-0566 or OO3) 571 Where toiluy Stock 7514. The Company's common and preferred stock may be pur-chased through a brokerage firm, A shareholder of record ,fransfer Agent holding the Company's common stock in his/her name may The Company is the sole transfer agent and registrar for its purchasecommon,stockthrough theCompany% Automatic c mmon and preferred stock. Dividend Reinvestment and Common Stock Purc hase Plan (the *DRP")(see section entitled " Dividend Reinvestment flow toTransfer Stock , Plan"fordetailst A transfer of stock is required whenever the registration of a stock cenificate is changed. A change in registration gener-Where to SellStock ally ccurswhenstock heldinotherthan anomineeorstreet The Company's common or preferred stock held in certifi- name" is sold. Changes of name, co-owners, tenancy, etc. cate form may be sold through a brokerage firm. Shares held "I6" "NUI"'a tra nsfer. in the DRP by the Company for a participant may be ordered A transfer can be accomplished by properly filling in the out in certificate form by the participant and sold through a stock assignment form on the reverse side of the stock certifi-brokerage firm or may be sold through the DRP by sending ca'e and endorsing the assignment form exactly as the regis-in the appropriate form. Shares held in the DRP for a partici. trationisshown on the faceof thecertificate.The pant will not be sold for that participant between the record signature (s) of the transferor must be guaranteed either by a date for a dividend and the time when the records have been commercial bank or a brokerage firm that is a member of updated to reflect the reins estment of such dividend. une of the major stock exchanges. The certificate with the properly completed assignment can then be sent to the Dividend lleinvestment Plan Company for transfer. lt is recommended that certificates be i_ The Company's DRP provides common shareholders with sent registeredor certi/tedmail. E an economical and convenient method for purc hasing addi-tional shares of the Company's c ommon stock. Stock flegistration Dividends remvested through the DR P are used to purchase The purchaser has the choic e of having the stock delivered sharts of common stock directly from the Compa% 1he m kaWng it with the bn>ker. Stock lett with the broker is ! Company willissue the shares to the plan participants at a genera Hy held in the brokerage firm's name and referred to ! 3% discount from the average of the high and low sale prices as " street name" stock.The purchaser is generally referred to of the common stock, as reported on the consolidated tape as the beneficial owner. l-l l 12
_ _ . ._ ~. _. .__ _ . _ A purchaser who elects to take physical possession of the Dhidends Not itecelted stoc k receives a certificate (s) representing the number of Dividend c hec ks are mailed so as to reach shareholders on shares purc hased. The stoc k is registered on the Company's the dividend payment date. Shareholders who do not books in the name of the. purchaser who becomes a share- receive their dividend check on the appropriate dwidend holder of record. payment date should contact the 5hareholder Services Department. How ever, it is suggested that such contact be Safekeeping of Certificates delayed about ten days after the dividend payment date to When stoc k certificates are received, it is recommended that allow for any delay in mail delivery. the certificates be safeguarded by placing them in a secure place such as a bank safety deposit bot A separate certifi. State DaterlChecks cate record should be maintained including earh certificate Dividend aM liquidation c becks issued prior to August 1, number, purchase date, date of issue, amount paid and the 1990 will no longer be honored by Centtal Bank of Denver. exact registration. The Company does not sa/c Acep certifi- Shareholders with stale dated checks are requested to con-cares for shareholders. tact Shareholder Services for replacement instructions. Lost or Stolen Certificates Address Changes lia stoc k certificate is lost or stolen, notification should be - Please notify Shareholder services promptly of your address sent immediately to the company so a "stop" can be placed changes. De sure to give os your name, old address, new on the missing certificate. T he letter should contain as much address and your Shareholder Account Number. Mail to: Information as possible describing the certificate; in partico. Public Servic e Co. of Colo., Pn Box 040. Denver, CO lar, certificate number, date issued and registration. Once a 80201, Attm Sharcholder Services, Room 160.H.
} top" has been placed on the missing certificate, an affida' vit will be sent which must be completed, signed, notarized P W ioMI ' i de dends or reinvestrnent statements. Please include telephone and retumed before a replacement certificatc can be issued.
numbers on all correspondence. An irrevocable mdemnity bond for the lost stoc k certificate is also required. The cost is about 2% of the market value of
- the missing certificate, calculated at the time the indemnity bond is issued.
Information regarding lost or stolen certificates should be sent to Public Service Co. of Colo., P.O. Box 840, Denver, CO 80201, Attn: Shareholder Services, Room 160-B. Dividends Dividends on common stock, as declared by Ihe Board of Directors, are generally payable on the first day of February, May, August and November of each year.The Company pays regular quarterly dividends on its preferred stoc k on the first of March, June, September, and December of eat h year. Dividends paid on stoc k held in " street name' are paid to the , holder of recordJgenerally a brokerage firm or bank nomi-nee. The dividends are then redistributed to beneficial own. ers by the brokerage firm or bank in accordance with the beneficialowners' instructions. Shaicholders of record receive dividends directly from the Company unless such shareholder has elected to reinvest dividends through the Company's DRP or has authorized direct deposit of dividends to a financial institution. Dividends also can be deposited directly into shareholders' bank accounts through the electronic funds transfer (EFT) service. Shareholders who have summer and winter resi-l _ dences, who travel extensively, or who do not want to make trips to their banks find this service beneficial. For fu rther information, call (800)635 0566 or(303)5717514. 53
SHAREHOLDERINFORMATION Continued hblic Service Conyumy of Colorado andSubsidiaries Common and l' referred Closing Stock I' rices Annual Meeting The ac companying tables show the ranges of closing com. DAl E: Tuesday, May 7,1991 mon and preferred stock prices as shown on the consoli. PL ACE: Colorado Convention Center,70014th Street, dated tape and dividends paid on common stock by quarter Denver, Colorado-Lobby A . for 1990 and 1989. TIME: 2:00 p.m. (MDT) comnmnsimL 4th 3rd 2nd lit Ww Me AnnuaWwung,prmystatememsankards 3,,, are mailed approximately 30 days before the meeting date. High 2 n, 2i% 2 w. 26% tow 20v, 20 20 % n v. l'or Information Write or Calh tut Trade 23 v, 20% a% n% Public Service Company of Colorado Div. Dec. .so .so .so .so 55015th Street, Room 160-B, Denver, Colorado 80202 Div. Pant .50 .50 .50 .s (8001635 0566 (303)571-7514 19189 Mgh 2? 25v. 23% 21 % InvestorItclations Trade , (iv. Susan G. Pollack and Michael D. Pritchard Dis, Dec # .50 .50 .50 _Div. Paid. _ _ , . . _ , . .50 .s0 .,_...._0...5
.so Shareholder Services Cumulative
_ Preferred Stock 4th 3rd 2nd bl 4%4 Series 1990thgh 46 46% 4$ 47 t.ow 44 4 W. 43% 43 1989thgh 46 45 43% 44% Low 43% 42% 40% 41% 7.15% Serie, 1990 High 76 73 75 % 78 % Low 71 73 % 72 73 1989Fbgh 79 78% 75 % 71 % Low 74 % 74 68 % 68 % 8.40% Series ($25; 1990 High 237, 22 % 214 24 Low 21% 21 % 21 % 22% 1989Fhgh 23 % 23 % 22% 2
-.1 "L .-. 12% -.-22?L 22L. . .- 2 b.-
Dividend Reimestment l>lan Statistics Shareholder % of Shares % of Yect 14rtkipa its Total 1%rticipating Total 1990 28.065 50 2 12,327,468 22.7 1989 26,651 47.5 7,483,628 14.2 1988 24,939 42.1 7,017,429 13 4 I 54
I Sil ARI:llOI.DI.R CONINIUNICATIONS SURVEY 1990 ANNUAL. Rl:l' ORT QUAR 1 ERIX RI: PORTS
- 1. Hu mut.h o!' P% o s 1990 %auaI Kepon d-d mu rt o" $. How m o b ot PV oiQuarterb Resoh do mu read!
2 01 , , to . I all 7 iess than 9
... U( M M ur ] It% lhdh ) IMif e than ' h 6fW
" 6 to b J norw g g ygg,, pp, g gyg, q gg ,,3 g ,g ,pagg 2 h the 100 knu.d Report eau to read and umter ,tand' uswk ntand!
~2 very readable E.: v> mew hat d Mcub .. wn re adaNe a mmns hat ddht uit
; mmtm hat nf adabie m w'y dan v9 1 m ew has readabk ' ien dois uit
- 3. Plea # (in le lhe nundw r whg h reprewnh mur lecimp 7. heaw r ne PM u 1 thJ Quadent kepsh b) ( m hng the about the qu..hty ol in:otmanun. pr ewoubnn. .and readah.ht v numic hehm n ha h bet ticu t bes sour owrallimpremon-of the bliowmg pg
( gg,gg Riva + g h or (herall,i felt the 1990 firancialltiyhhghts 1 2 ) 4 5 6 ' b 9 to Quarterl) Hrporu were - 1 2 1 4 s6 ' H 9 10 At AGlahre 1 J 1 4 5 6 ' h 9 10
'lo Our $harcimider i 2 3 4 , t. 7 8 9 !O liard %un Strutep i 2 1 4 5 6 ' H 9 10 CON 1NIUNICATIONS PROG R utS I nsuring The luture 1 3 4 5 6 ' B 9 10 N, Hm mdd vou deu r.te PV u nharehohler arni mmtos Natural Gas 1 2 1 4 5 t. B 9 10 relahom progeane I.lectric Operations 1 2 3 4 i n 7 B 9 10 '. u.r y mt ; adequa.e
' laking T hc Lead Regulatory Entironnwnt 1 2 1 4 5 6 7 8 9 to ? voi a madequate 1 2 3 I i b ' B9 10 Sharchedder information i 2 3 4 5 o ~ b u _;ses 10 $ % ndem couabworn%aW N.aNy irW v vnr.4 conrely a no
- 4. Pleamaw thromali t wo Annual kensoln c m nnstne 10. k there any mhw maton you would addI nomior e ha h best deu ntos voor trehneon tM loihm mg oxadw hu Candor ' 2 3 4 , o - 8 o 10 (htraillmprewun 2 3 4 5 6 ' F. 9 10 ll. W hat n sour bp Code' Sil ARLilOI. DER PROFl!J. Additionalinformation and f >uplicate Mailinn Pitase circle one answer to tach quntim SneeNaden mieresmthn rnen ing the pubht anonwr flow h)uur stock reghtered? adaud mianianon ht@wlow, onhow w ho nww I. Io sou or a tanuis men &, dupk ee rnainp m Mannual Report ce aue:1 to( Fet-k
- 2. In nommw or meet namo 1he dDP'opNueim t W m x s ount nor'd4 t rev and addrew and mad ths pista& od(ard AI' f 8WTI7 ] tinancialand $tathtkal Hesicw 19MO 1990 l Under 2 > t 4 % na ~_ Form !O K 2 25-44 4 hi or o* _J Dhidend Reinsntment Plan Infortnation 15Co shares owned? (inc!ude dividend reinvntmenh C Currently recebe more than one copy of Annual Report.
'. Under 50 4.5011 u o Pu ronona .etema+c iWen m umi mnterw rmm 2.50-100 5. I (Oldt u) ^"
- kWM"d Wd 1 101 Suij o (her 2 pin llow long has e ynu been a 1500 shareholder?
!.leuthanI tear 4. 6- 10 s ean 2.1-2yean 1 i I c20 wan 1 15 yean 6 (her 20 yean
'rincird teamn for holdtug PSCo steck?
- 1. Dmdend mc ome 3 Inmme p ourowth 2 I aveterm gnmth 4 L)ther
% hict. namt inNenced you to acquire 1500 stig k? Nd "' F""'
L hr.onal rnearth 4 Got mhentante Name
- 2. Stot hbruker 5 finanoi puhu ezon
). f nend or rel.thw 6 Oner
$rrnt and Nomt,er
% hat most concerni vou utout PSCo' Cuy
@ PrmtedonRegcledPaper % hat k your Zip C, ode?
State - bp .
.n.- n -- . - - . .. .. ~ -- ,.. . . . . - . _ . _ . . . _ _ - .- .. _ i 1 l NO POSTAGE NECESSARY If MAILED IN THE UNITED STATES BUSINESS REPLY MAIL FIRST CLASS Mall PERMIT NO 266 DENVER. COLORADO POSTAGE WILL BE PAID BY ADDRESSEE PUBLIC SERVICE COMPANY OF COLORADO ' investor Relations, Room 860 P O BOX 840
-DENVER CO 80201 9716 .
I linlillonil.Illonallliinlinlinilillnillnl NO POSTAGE NECESSARY IF MAILED IN THE UNITED STATES BUSINESS REPLY Mall FIRST CLASS MAIL PERMIT NO. 266 DENVER. COLORADO POSTAGE WILL BE PAID DY ADDRESSEE PUBLIC SERVICE COMPANY OF COLORADO investor Relations, Room 860 P O BOX 840 DENVER C0 80201- 9716 ll ilillio ni.llinnoill Inlinienllill...llnl
BOARD OF DIRECTORS AND EXECUTIVE OFFICERS llaardof Directors becuthe Committee RobertT.Perwn Jr.' Phillip I.. Null D.Itilock D.D Hak u' " ""' M"""Id
- Denwef, CO O 48 h DonsM Drury ^F A .
g Chairmanof the Board, George B M(Kinlev I.au rence I; Petrint President and Will L Nic helson it. James ll. Runniger Southeau Metropohtan ChiciE secutne Onc er RobertG Tointon va c President, Age 60 CIS: Age 55 Regulabon and g ,4 gg
^" ,"*" " ' U"" O" * "' Southwev Metr opohtan Collh P. Chandler.Jr.
Demer. CO t l4B h l M<hael Powers ^E* U U Age 54 UF President Thonw I f ariev MarH3n L.Ta3tor pgy gg Chandler & Anociates Inc GadeL Greer W e Pieudent, North Metropo etan Age 64 Thomas E Rodnguel Human Raourt n g g4)()gn n rC Penam insestment Committn g Regis Cohege W Th, mas Stephens Feasurer Companies be(utive Duec tor. Colhs P Chandler. Jr Age 41 O b MB A program A Barry Wrschfeld O'U II"Ck Preudent. Center los Business and Ecorx>mic Forecasung Rodneyt Shier Other Omcers yh 'W"d"""
%. Ma3 ne Brow n Green and Clear L akes Company Age 64 ( ompemadon emm ttee g ThomasT. Furley DoraM Drur) Age 40 0 8: P.5.R Inmtments inc, Pueblo, CO(1983) George D Mc Ainle) Age 5'> QBi Attorney at Law Will F. Nichokon, Jr. Ant J. l&Hh Petersen 6 f onda W Th(unantephens and Auditor f ueIRe ources Pro a.s ionaKorp. Rotert G. Tomton yg becuthe Offkers Georp P. Green W"'"" 'd' SVPP4 Cl""Pd"'
Ga# lo Gar A istantSe(retary AFD# Ap 6 PhHlip D. Shaffer
\ e Pr id nt erkan r n of the Board.
Chevenne L!ght. Iuel Telesiuon President and steun R. Loeshelle andCommanicatiom Chief becutiseOfficer Auktant Secretary and ""O"" " l"'"Pd ") Corporahon Age 55 R8) Awatant heasurer AF4M A 8 '49 Age 41 Ph Rajeuna Gable Clark il. Euald A.llarry filrschfeld Senior Vge Prnident. Marlh n B. Pollard Nd" "dl IU'h C "'P"'dt'"" Denver. CO 098m Customers Amtant Seuetary ^F # resident. A.B Hirschfeld Age 56 0 i) Age 53 R9; OhPM W WW 4E'"'jg"' Richard C. Kelly 5enior Vice Proident, Stephen ll. Whhcomb Officers Awislant Secretar) Rkhard L llruun George D. Mc Kinley finance and Age 400 51 hanston, WY n 9 de Chief finanaalOtfice, becuby t9e Preudent President Ap 44R3 Rkhard I.. Ilunt and Chief Operating OHn er First Mc Ainley Cor AuNant beauer F uel Raoun n DneWpment Q Age 63 WM % Madu AM8W ApM g) Sennar bce Preudent Wut F. Nkhohon,Jr. Electnc Operahons Sman G. PoHack Unn T. Lnburg Denver, CO n 900 Age 53 0 0 Assistant heasure' 9 e President and Aye 6 General Manager Chairrnan of the Board Wmtem Gas 5upph Co. and P6dm 3d* N.. McCot.lt r mm nd Managen.Geographk Age 48 U4) Colorado Nahonal General Counsel a V Ob14cm Bankshares,Inc. Jowph Augustine,Jr. W"I C""""I Age 61 [5 ns e Meuopohtan Aelb Stansheld & O'Donnell J. MichaelPowers A Middenu Ap 44 '20) Denver, Colorado Chevenne. WY U 978) " # .d""' President. Powers Bnc k and Tile IHil L. Croley f "*" Independent Pu%c Annuntanu and Powers Products Co Pueblo Age 48 Manager, Southern Region
~
Arthur Andersen & Co. Thomas E. Rodriguez A. rawford and Pueblo Divimon 717 i 7th street. Denver, CO 0 98@ Vice Preudent. Age 500 B) Suite 1000
' P"dD""* Dens,er, Colorado f' President, T homas E. Rodriguez &
E Dasid P. Das ta Boulder Anoaates. P.C. {g Age 46 Dale V. Fetchenhier Ap45 (2D ' Reu.gned 3 191 Rodney E. Slifer
"""' Michaei j. Gelle Cd""D* *W
[ loi nuan a hndon ( *C""e*n d"ma with the Company f Vail COO 98% Home light and 5ervices through Dec embe.1990 t Partner Ap 570 h gg4ggg y-Shfer. Smith & Frampton Age 56 Ross C. King W. Thomas Stephens
'N "'
Ag handu Agentand Reghtrur Denver,CO M 9891 Regional Customer Operanons for alliwues of Capital Mock E ethi.. lleadrkk Chairman, President, and AA049 N4' transfet Agent.Dwidend j [g"h Chief bec utive Offn er %liliam j. Martin ggg g ' Paymg Agent. Dividend Vice President, 93 t, Manville Corporation A e 51(30' Reinsestment y Age 48 Electnc Engineering Plan Agent Registra anMemnx Dough C. lackhart Pubhc Serae Company l Robert G. Tointon i Greeley, CO O 988: ^#U """" of Colora$10 Preudent Earl E. Sklaughlin. j r. Ap 48 . Denwdobrado s PhelpvTointon,Inc. Vice Preudent. Jowpb O. Marques 4 Age 57 Marketing. San L uis Vallev b ( )iearelectedtothe
" " ^F U @ & Boardof Directors and S'uppqt Serucen Age 5000s $ Ages as of Decernber 31,1990
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