nspm-20250630

Definitions of Abbreviations


Xcel Energy Inc.’s Subsidiaries and Affiliates (current and former)
NSP-Minnesota			Northern States Power Company, a Minnesota corporation
NSP System			The electric production and transmission system of NSP-Minnesota and NSP-Wisconsin operated on an integrated basis and managed by NSP-Minnesota
NSP-Wisconsin			Northern States Power Company, a Wisconsin corporation
PSCo			Public Service Company of Colorado
SPS			Southwestern Public Service Company
Utility subsidiaries			NSP-Minnesota, NSP-Wisconsin, PSCo and SPS
Xcel Energy			Xcel Energy Inc. and its subsidiaries

Federal and State Regulatory Agencies

DOC			Minnesota Department of Commerce
EPA			United States Environmental Protection Agency
FASB			Financial Accounting Standards Board
FERC			Federal Energy Regulatory Commission
IRS			Internal Revenue Service
MPUC			Minnesota Public Utilities Commission
NDPSC			North Dakota Public Service Commission

PSCW			Public Service Commission of Wisconsin
SEC			Securities and Exchange Commission
SDPUC			South Dakota Public Utilities Commission







Other
ALJ			Administrative Law Judge
ASU			Accounting standards update

C&I			Commercial and Industrial
CCR			Coal combustion residuals
CCR Rule			Final rule (40 CFR 257.50 - 257.107) published by the EPA regulating the management, storage and disposal of CCRs as nonhazardous waste
CEO			Chief executive officer
CERCLA			Comprehensive Environmental Response, Compensation, and Liability Act
CFO			Chief financial officer
CO2			Carbon dioxide
CSPV			Crystalline Silicon Photovoltaic
CUB			Citizens Utility Board
DSM			Demand side management
ETR			Effective tax rate

FTR			Financial transmission right
GAAP			United States generally accepted accounting principles
IPP			Independent power producing entity


MGP			Manufactured gas plant
MISO			Midcontinent Independent System Operator, Inc.
NAV			Net asset value
NOx			Nitrogen Oxides
O&M			Operating and maintenance
OAG			Office of the Minnesota Attorney General
OBBB			One Big Beautiful Bill Act
PFAS			Per- and Polyfluoroalkyl Substances
PPA			Power purchase agreement
PTC			Production tax credit
RDF			Refuse-derived fuel
RFP			Request for proposal
ROE			Return on equity
RTO			Regional Transmission Organization

VIE			Variable interest entity
XLI			Xcel Large Industrials


Measurements
MW			Megawatts


Forward-Looking Statements

Except for the historical statements contained in this report, the matters discussed herein are forward-looking statements that are subject to certain risks, uncertainties and assumptions. Such forward-looking statements, including those relating to future sales, future expenses, future tax rates, future operating performance, estimated base capital expenditures and financing plans, projected capital additions and forecasted annual revenue requirements with respect to rider filings, expected rate increases or refunds to customers, expectations and intentions regarding regulatory proceedings, expected pension contributions, and expected impact on our results of operations, financial condition and cash flows of legal proceeding outcomes, as well as assumptions and other statements are intended to be identified in this document by the words “anticipate,” “believe,” “could,” “estimate,” “expect,” “intend,” “may,” “objective,” “outlook,” “plan,” “project,” “possible,” “potential,” “should,” “will,” “would” and similar expressions. Actual results may vary materially. Forward-looking statements speak only as of the date they are made, and we expressly disclaim any obligation to update any forward-looking information. The following factors, in addition to those discussed in NSP-Minnesota’s Annual Report on Form 10-K for the fiscal year ended Dec. 31, 2024 and subsequent filings with the SEC, could cause actual results to differ materially from management expectations as suggested by such forward-looking information: operational safety, including our nuclear generation facilities and other utility operations; successful long-term operational planning; commodity risks associated with energy markets and production; rising energy prices and fuel costs; qualified employee workforce and third-party contractor factors; violations of our Codes of Conduct; our ability to recover costs; changes in regulation; reductions in our credit ratings and the cost of maintaining certain contractual relationships; general economic conditions, including recessionary conditions, inflation rates, monetary fluctuations, supply chain constraints and their impact on capital expenditures and/or the ability of NSP-Minnesota to obtain financing on favorable terms; availability or cost of capital; our customers’ and counterparties’ ability to pay their debts to us; assumptions and costs relating to funding our employee benefit plans and health care benefits; tax laws; uncertainty regarding epidemics; effects of geopolitical events, including war and acts of terrorism; cybersecurity threats and data security breaches; seasonal weather patterns; changes in environmental laws and regulations; climate change and other weather events; natural disaster and resource depletion, including compliance with any accompanying legislative and regulatory changes; costs of potential regulatory penalties and wildfire damages in excess of liability insurance coverage; regulatory changes and/or limitations related to the use of natural gas as an energy source; challenging labor market conditions and our ability to attract and retain a qualified workforce; and our ability to execute on our strategies or achieve expectations related to environmental, social and governance matters including as a result of evolving legal, regulatory and other standards, processes, and assumptions, the pace of scientific and technological developments, increased costs, the availability of requisite financing, and changes in carbon markets.


	Six Months Ended June 30
	2025		2024
Operating activities
Net income	$	373	$	342
Adjustments to reconcile net income to cash provided by operating activities:
Depreciation and amortization	582		544
Nuclear fuel amortization	55		53
Deferred income taxes	184		160
Allowance for equity funds used during construction	(33)		(24)
Provision for bad debts	13		8

Changes in operating assets and liabilities:
Accounts receivable	23		16
Accrued unbilled revenues	(15)		(10)
Inventories	(19)		1
Other current assets	(1)		(46)
Accounts payable	(76)		23
Net regulatory assets and liabilities	(21)		(29)
Other current liabilities	(37)		(270)
Pension and other employee benefit obligations	(54)		(43)
Other, net	(6)		15
Net cash provided by operating activities	968		740

Investing activities
Capital/construction expenditures	(1,367)		(1,308)
Purchase of investment securities	(571)		(469)
Proceeds from the sale of investment securities	570		450
Investments in utility money pool arrangement	(649)		(357)
Repayments from utility money pool arrangement	682		414
Other, net	—		(3)
Net cash used in investing activities	(1,335)		(1,273)

Financing activities
Repayments of short-term borrowings, net	(195)		(165)
Borrowings under utility money pool arrangement	798		100
Repayments under utility money pool arrangement	(798)		(100)
Proceeds from issuance of long-term debt	1,083		687

Capital contributions from parent	251		499
Dividends paid to parent	(190)		(222)

Net cash provided by financing activities	949		799

Net change in cash, cash equivalents and restricted cash	582		266
Cash, cash equivalents and restricted cash at beginning of period	71		34
Cash, cash equivalents and restricted cash at end of period	$	653	$	300

Supplemental disclosure of cash flow information:
Cash paid for interest (net of amounts capitalized)	$	(164)	$	(149)
Cash received from income taxes, net; includes proceeds from tax credit transfers	313		193

Supplemental disclosure of non-cash investing and financing transactions:
Accrued property, plant and equipment additions	$	291	$	217
Inventory transfers to property, plant and equipment	26		21
Operating lease right-of-use assets	—		39
Allowance for equity funds used during construction	33		24


	June 30, 2025		Dec. 31, 2024
Assets
Current assets
Cash and cash equivalents	$	653	$	71
Accounts receivable, net	481		530
Accounts receivable from affiliates	15		1
Investments in money pool arrangements	—		33
Accrued unbilled revenues	287		272
Inventories	335		339
Regulatory assets	406		364
Derivative instruments	69		36

Prepayments and other	147		139
Total current assets	2,393		1,785

Property, plant and equipment, net	21,787		20,860

Other assets
Nuclear decommissioning fund and other investments	3,749		3,548
Regulatory assets	726		813
Derivative instruments	53		67
Operating lease right-of-use assets	347		393
Other	32		19
Total other assets	4,907		4,840
Total assets	$	29,087	$	27,485

Liabilities and Equity
Current liabilities
Current portion of long-term debt	$	250	$	250
Short-term debt	—		195

Accounts payable	639		631
Accounts payable to affiliates	102		100
Regulatory liabilities	465		543
Taxes accrued	213		221
Accrued interest	96		90
Dividends payable to parent	108		80
Derivative instruments	27		31
Operating lease liabilities	100		97
Other	141		150
Total current liabilities	2,141		2,388

Deferred credits and other liabilities
Deferred income taxes	2,495		2,238
Regulatory liabilities	2,288		2,155
Asset retirement obligations	3,149		3,073
Derivative instruments	67		77
Pension and employee benefit obligations	100		151
Operating lease liabilities	265		317
Other	41		41
Total deferred credits and other liabilities	8,405		8,052

Commitments and contingencies
Capitalization
Long-term debt	8,565		7,607
Long-term debt - related parties	294		166
Common stock — 5,000,000 shares authorized of $0.01 par value; 1,000,000 shares outstanding at June 30, 2025 and Dec. 31, 2024, respectively	—		—
Additional paid in capital	6,650		6,399
Retained earnings	3,036		2,881
Accumulated other comprehensive loss	(4)		(8)
Total common stockholder's equity	9,682		9,272
Total liabilities and equity	$	29,087	$	27,485


	Common Stock Issued					Retained Earnings		Accumulated Other Comprehensive Loss		Total Common Stockholder's Equity
	Shares	Par Value		Additional Paid In Capital
Three Months Ended June 30, 2025 and 2024
Balance at March 31, 2024	1,000,000	$	—	$	6,031	$	2,651	$	(8)	$	8,674
Net income						131				131

Dividends declared to parent						(103)				(103)
Contribution of capital by parent				153						153
Balance at June 30, 2024	1,000,000	$	—	$	6,184	$	2,679	$	(8)	$	8,855

Balance at March 31, 2025	1,000,000	$	—	$	6,650	$	2,954	$	(10)	$	9,594
Net income						189				189
Other comprehensive income								6		6
Dividends declared to parent						(107)				(107)

Balance at June 30, 2025	1,000,000	$	—	$	6,650	$	3,036	$	(4)	$	9,682

	Common Stock Issued					Retained Earnings		Accumulated Other Comprehensive Loss		Total Common Stockholder's Equity
	Shares	Par Value		Additional Paid In Capital
Six Months Ended June 30, 2025 and 2024
Balance at Dec. 31, 2023	1,000,000	$	—	$	5,686	$	2,541	$	(20)	$	8,207
Net income						342				342
Other comprehensive income								12		12
Dividends declared to parent						(204)				(204)
Contribution of capital by parent				498						498

Balance at June 30, 2024	1,000,000	$	—	$	6,184	$	2,679	$	(8)	$	8,855

Balance at Dec. 31, 2024	1,000,000	$	—	$	6,399	$	2,881	$	(8)	$	9,272
Net income						373				373
Other comprehensive income								4		4
Dividends declared to parent						(218)				(218)
Contribution of capital by parent				251						251
Balance at June 30, 2025	1,000,000	$	—	$	6,650	$	3,036	$	(4)	$	9,682


See Notes to Consolidated Financial Statements

NSP-MINNESOTA AND SUBSIDIARIES

Notes to Consolidated Financial Statements (UNAUDITED)

In the opinion of management, the accompanying unaudited consolidated financial statements contain all adjustments necessary to present fairly, in accordance with GAAP, the financial position of NSP-Minnesota and its subsidiaries as of June 30, 2025 and Dec. 31, 2024; the results of NSP-Minnesota’s operations, including the components of net income, comprehensive income and changes in stockholder’s equity for the three and six months ended June 30, 2025 and 2024; and NSP-Minnesota’s cash flows for the six months ended June 30, 2025 and 2024.

All adjustments are of a normal, recurring nature, except as otherwise disclosed. Management has also evaluated the impact of events occurring after June 30, 2025 up to the date of issuance of these consolidated financial statements. These statements contain all necessary adjustments and disclosures resulting from that evaluation. The Dec. 31, 2024 balance sheet information has been derived from the audited 2024 consolidated financial statements included in the NSP-Minnesota Annual Report on Form 10-K for the year ended Dec. 31, 2024.

Notes to the consolidated financial statements have been prepared pursuant to the rules and regulations of the SEC for Quarterly Reports on Form 10-Q. Certain information and note disclosures normally included in financial statements prepared in accordance with GAAP on an annual basis have been condensed or omitted pursuant to such rules and regulations. For further information, refer to the consolidated financial statements and notes thereto included in the NSP-Minnesota Annual Report on Form 10-K for the year ended Dec. 31, 2024, filed with the SEC on Feb. 27, 2025. Due to the seasonality of NSP-Minnesota’s electric and natural gas sales, interim results are not necessarily an appropriate base from which to project annual results.


1. Summary of Significant Accounting Policies

The significant accounting policies set forth in Note 1 to the consolidated financial statements in the NSP-Minnesota Annual Report on Form 10-K for the year ended Dec. 31, 2024 appropriately represent, in all material respects, the current status of accounting policies and are incorporated herein by reference.


2. Accounting Pronouncements

Recently Issued

Income Taxes — In December 2023, the FASB issued ASU 2023-09 – Income Taxes (Topic 740) – Improvements to Income Tax Disclosures, with new disclosure requirements including presentation of prescribed line items in the ETR reconciliation and disclosures regarding state and local tax payments. The ASU is effective for annual periods beginning after Dec. 15, 2024, and NSP-Minnesota does not expect implementation of the new disclosure guidance to have a material impact on its consolidated financial statements.

Disaggregation of Income Statement Expenses — In November 2024, the FASB issued ASU 2024-03 – Disaggregation of Income Statement Expenses, which requires disclosure of additional detail for certain categories of income statement expenses. The ASU is effective for annual periods beginning after Dec. 15, 2026 and interim reporting periods beginning after Dec. 15, 2027. NSP-Minnesota is currently evaluating the impact of the new disclosure guidance.


3. Selected Balance Sheet Data


(Millions of Dollars)	June 30, 2025		Dec. 31, 2024
Accounts receivable, net
Accounts receivable	$	518	$	572
Less allowance for bad debts	(37)		(42)
Accounts receivable, net	$	481	$	530


(Millions of Dollars)	June 30, 2025		Dec. 31, 2024
Inventories
Materials and supplies	$	245	$	234
Fuel	80		81
Natural gas	10		24
Total inventories	$	335	$	339


(Millions of Dollars)	June 30, 2025		Dec. 31, 2024
Property, plant and equipment, net
Electric plant	$	23,678	$	23,218
Natural gas plant	2,505		2,472
Common and other property	1,507		1,450
Plant to be retired (a)	521		554
Construction work in progress	2,159		1,522
Total property, plant and equipment	30,370		29,216
Less accumulated depreciation	(9,057)		(8,753)
Nuclear fuel	3,623		3,491
Less accumulated amortization	(3,149)		(3,094)
Property, plant and equipment, net	$	21,787	$	20,860

(a)Amounts include Sherco 1 and 3 and A.S. King. Balance is presented net of accumulated depreciation.


4. Borrowings and Other Financing Instruments

Short-Term Borrowings

NSP-Minnesota meets its short-term liquidity requirements primarily through the issuance of commercial paper and borrowings under its credit facility and the money pool.

Money Pool — Xcel Energy and its utility subsidiaries have established a money pool arrangement that allows for short-term investments in and borrowings between the utility subsidiaries. Xcel Energy may make investments in the utility subsidiaries at market-based interest rates; however, the money pool arrangement does not allow the utility subsidiaries to make investments in Xcel Energy.

Money pool borrowings:


(Amounts in Millions, Except Interest Rates)	Three Months Ended June 30, 2025			Year Ended Dec. 31, 2024
Borrowing limit	$	250		$	250
Amount outstanding at period end	—			—
Average amount outstanding	58			10
Maximum amount outstanding	250			139
Weighted average interest rate, computed on a daily basis	4.33		%	4.82		%
Weighted average interest rate at period end	N/A			N/A

Commercial Paper — Commercial paper outstanding:


(Amounts in Millions, Except Interest Rates)	Three Months Ended June 30, 2025			Year Ended Dec. 31, 2024
Borrowing limit	$	800		$	700
Amount outstanding at period end	—			195
Average amount outstanding	14			54
Maximum amount outstanding	85			400
Weighted average interest rate, computed on a daily basis	4.66		%	5.39		%
Weighted average interest rate at period end	N/A			4.63

Letters of Credit — NSP-Minnesota uses letters of credit, generally with terms of one year, to provide financial guarantees for certain obligations. There were $12 million of letters of credit outstanding under the credit facility at both June 30, 2025 and Dec. 31, 2024. Amounts approximate their fair value and are subject to fees.

Revolving Credit Facility — In order to issue its commercial paper, NSP-Minnesota must have a revolving credit facility equal to or greater than the commercial paper borrowing limit and cannot issue commercial paper exceeding available capacity under this credit facility. The credit facility provides short-term financing in the form of notes payable to banks, letters of credit and back-up support for commercial paper borrowings.

In May 2025, NSP-Minnesota entered into an amended five-year credit agreement with a syndicate of banks, with substantially the same terms and conditions as the prior credit agreements. The borrowing limit for NSP-Minnesota was increased from $700 million to $800 million, and the maturity was extended from September 2027 to December 2029.

NSP-Minnesota has the right to request an extension of the revolving credit facility termination date for two additional one-year periods. All extension requests are subject to majority bank group approval.

At June 30, 2025, NSP-Minnesota had the following committed revolving credit facility available (in millions of dollars):


Credit Facility (a)		Drawn (b)		Available
$	800	$	12	$	788

(a)Expires in December 2029.

(b)Includes outstanding commercial paper and letters of credit.

All credit facility bank borrowings, outstanding letters of credit and outstanding commercial paper reduce the available capacity under the credit facility. NSP-Minnesota had no direct advances on the credit facility outstanding at June 30, 2025 and Dec. 31, 2024.

Bilateral Credit Agreement — In April 2025, NSP-Minnesota’s uncommitted bilateral credit agreement was renewed for an additional one-year term. The credit agreement is limited in use to support letters of credit.

As of June 30, 2025, NSP-Minnesota had $72 million of outstanding letters of credit under the $75 million bilateral credit agreement.

Long-Term Borrowings

During the six months ended June 30, 2025, NSP-Minnesota issued $600 million of 5.05% First Mortgage Bonds due May 15, 2035 and $500 million of 5.65% First Mortgage Bonds due May 15, 2055.

Xcel Energy Inc.’s Purchase of NSP-Minnesota’s First Mortgage Bonds — During the six months ended June 30, 2025, Xcel Energy Inc. purchased $128 million in aggregate principal amounts of NSP-Minnesota’s 2.90% First Mortgage Bonds Series due March 1, 2050, 2.60% First Mortgage Bonds Series due June 1, 2051 and 3.20% First Mortgage Bonds Series due April 1, 2052, for $81 million. Bonds purchased by Xcel Energy Inc. are reported in long-term debt - related parties on NSP-Minnesota’s consolidated balance sheet, and interest expense related to the repurchased bonds was immaterial for the six months ended June 30, 2025.


5. Revenues

Revenue is classified by the type of goods/services rendered and market/customer type. NSP-Minnesota’s operating revenues consisted of the following:


	Three Months Ended June 30, 2025
(Millions of Dollars)	Electric		Natural Gas		All Other		Total
Major revenue types
Revenue from contracts with customers:
Residential	$	417	$	54	$	1	$	472
C&I	615		42		—		657
Other	11		—		1		12
Total retail	1,043		96		2		1,141
Wholesale	74		—		—		74
Transmission	66		—		—		66
Interchange and other	123		5		—		128
Total revenue from contracts with customers	1,306		101		2		1,409
Alternative revenue and other	30		9		—		39
Total revenues	$	1,336	$	110	$	2	$	1,448


	Three Months Ended June 30, 2024
(Millions of Dollars)	Electric		Natural Gas		All Other		Total
Major revenue types
Revenue from contracts with customers:
Residential	$	350	$	37	$	—	$	387
C&I	571		25		—		596
Other	10		—		3		13
Total retail	931		62		3		996
Wholesale	57		—		—		57
Transmission	56		—		—		56
Interchange and other	115		11		—		126

Total revenue from contracts with customers	1,159		73		3		1,235
Alternative revenue and other	78		17		—		95
Total revenues	$	1,237	$	90	$	3	$	1,330


	Six Months Ended June 30, 2025
(Millions of Dollars)	Electric		Natural Gas		All Other		Total
Major revenue types
Revenue from contracts with customers:
Residential	$	818	$	249	$	1	$	1,068
C&I	1,159		176		—		1,335
Other	20		—		4		24
Total retail	1,997		425		5		2,427
Wholesale	192		—		—		192
Transmission	131		—		—		131
Interchange and other	246		8		—		254

Total revenue from contracts with customers	2,566		433		5		3,004
Alternative revenue and other	64		37		—		101
Total revenues	$	2,630	$	470	$	5	$	3,105



	Six Months Ended June 30, 2024
(Millions of Dollars)	Electric		Natural Gas		All Other		Total
Major revenue types
Revenue from contracts with customers:
Residential	$	718	$	175	$	7	$	900
C&I	1,093		115		—		1,208
Other	19		—		4		23
Total retail	1,830		290		11		2,131
Wholesale	132		—		—		132
Transmission	119		—		—		119
Interchange and other	240		28		—		268

Total revenue from contracts with customers	2,321		318		11		2,650
Alternative revenue and other	171		45		—		216
Total revenues	$	2,492	$	363	$	11	$	2,866


6. Income Taxes

Reconciliation between the statutory rate and ETR:


	Six Months Ended June 30
	2025		2024
Federal statutory rate	21.0	%	21.0	%
State income tax on pretax income, net of federal tax effect	7.0		7.0
(Decreases) increases:
PTCs (a)	(56.6)		(49.9)
Plant regulatory differences (b)	(7.0)		(5.4)
Other tax credits, net operating loss & tax credit allowances	(1.4)		(1.1)

Other, net	0.9		0.8
Effective income tax rate	(36.1)	%	(27.6)	%

(a)Wind and solar PTCs (net of estimated transfer discounts) are generally credited to customers (reduction to revenue) and do not materially impact earnings.

(b)Plant regulatory differences primarily relate to the credit of excess deferred taxes to customers. Income tax benefits associated with the credit are offset by corresponding revenue reductions.


7. Fair Value of Financial Assets and Liabilities

Fair Value Measurements

Accounting guidance for fair value measurements and disclosures provides a hierarchical framework for disclosing the observability of the inputs utilized in measuring assets and liabilities at fair value.

•Level 1 — Quoted prices are available in active markets for identical assets or liabilities as of the reporting date. The types of assets and liabilities included in Level 1 are actively traded instruments with observable actual trading prices.

•Level 2 — Pricing inputs are other than actual trading prices in active markets, but are either directly or indirectly observable as of the reporting date. The types of assets and liabilities included in Level 2 are typically either comparable to actively traded securities or contracts, or priced with models using highly observable inputs.

•Level 3 — Significant inputs to pricing have little or no observability as of the reporting date. The types of assets and liabilities included in Level 3 include those valued with models requiring significant judgment or estimation.

Specific valuation methods include:

Investments in equity securities and other funds — Equity securities are valued using quoted prices in active markets. The fair values for commingled funds are measured using NAVs. The investments in commingled funds may be redeemed for NAV with proper notice. Private equity commingled funds require approval of the fund for any unscheduled redemption, and such redemptions may be approved or denied by the fund at its sole discretion. Unscheduled distributions from real estate commingled funds may be redeemed with proper notice, however, withdrawals may be delayed or discounted as a result of fund illiquidity.

Investments in debt securities — Fair values for debt securities are determined by a third party pricing service using recent trades and observable spreads from benchmark interest rates for similar securities.

Interest rate derivatives — Fair values of interest rate derivatives are based on broker quotes that utilize current market interest rate forecasts.

Commodity derivatives — Methods used to measure the fair value of commodity derivative forwards and options utilize forward prices and volatilities, as well as pricing adjustments for specific delivery locations, and are generally assigned a Level 2 classification.

When contracts relate to inactive delivery locations or extend to periods beyond those readily observable on active exchanges, the significance of the use of less observable inputs on a valuation is evaluated and may result in Level 3 classification.

Electric commodity derivatives held by NSP-Minnesota include transmission congestion instruments, generally referred to as FTRs. FTRs purchased from an RTO are financial instruments that entitle or obligate the holder to monthly revenues or charges based on transmission congestion across a given transmission path.

The values of these instruments are derived from, and designed to offset, the costs of transmission congestion. In addition to overall transmission load, congestion is also influenced by the operating schedules of power plants and the consumption of electricity pertinent to a given transmission path. Unplanned plant outages, scheduled plant maintenance, changes in the relative costs of fuels used in generation, weather and overall changes in demand for electricity can each impact the operating schedules of the power plants on the transmission grid and the value of these instruments.

FTRs are recognized at fair value and adjusted each period prior to settlement. Given the limited observability of certain variables underlying the reported auction values of FTRs, these fair value measurements have been assigned a Level 3 classification.

Net congestion costs, including the impact of FTR settlements are shared through fuel and purchased energy cost recovery mechanisms. As such, the fair value of the unsettled instruments (i.e., derivative asset or liability) is offset/deferred as a regulatory asset or liability.

Non-Derivative Fair Value Measurements

The Nuclear Regulatory Commission requires NSP-Minnesota to maintain a portfolio of investments to fund the costs of decommissioning its nuclear generating plants. Assets of the nuclear decommissioning fund are legally restricted for the purpose of decommissioning these facilities. The fund contains cash equivalents, debt securities, equity securities and other investments. NSP-Minnesota uses the MPUC approved asset allocation for the investment targets by asset class for the qualified trust.

NSP-Minnesota recognizes the costs of funding the decommissioning over the lives of the nuclear plants, assuming rate recovery of all costs. Realized and unrealized gains on fund investments over the life of the fund are deferred as an offset of NSP-Minnesota’s regulatory asset or as a regulatory liability (dependent on funding status) for nuclear decommissioning costs. Consequently, any realized and unrealized gains and losses on securities in the nuclear decommissioning fund are deferred as a component of the regulatory asset/liability.

Unrealized gains for the nuclear decommissioning fund were $1.6 billion and $1.4 billion as of June 30, 2025 and Dec. 31, 2024, respectively, and unrealized losses were $47 million and $49 million as of June 30, 2025 and Dec. 31, 2024, respectively.

Non-derivative instruments with recurring fair value measurements in the nuclear decommissioning fund:


	June 30, 2025
			Fair Value
(Millions of Dollars)	Cost		Level 1		Level 2		Level 3		NAV		Total
Nuclear decommissioning fund (a)
Cash equivalents	$	56	$	56	$	—	$	—	$	—	$	56
Commingled funds	703		—		—		—		1,032		1,032
Debt securities	879		—		864		10		—		874
Equity securities	538		1,730		2		—		—		1,732
Total	$	2,176	$	1,786	$	866	$	10	$	1,032	$	3,694

(a)Reported in nuclear decommissioning fund and other investments on the consolidated balance sheets, which also includes $55 million of other investments, including the rabbi trust.


	Dec. 31, 2024
			Fair Value
(Millions of Dollars)	Cost		Level 1		Level 2		Level 3		NAV		Total
Nuclear decommissioning fund (a)
Cash equivalents	$	39	$	39	$	—	$	—	$	—	$	39
Commingled funds	703		—		—		—		1,025		1,025
Debt securities	866		—		832		14		—		846
Equity securities	522		1,583		1		—		—		1,584
Total	$	2,130	$	1,622	$	833	$	14	$	1,025	$	3,494

(a)Reported in nuclear decommissioning fund and other investments on the consolidated balance sheets, which also includes $54 million of other investments, including the rabbi trust.

For the three and six months ended June 30, 2025 and 2024, there were no transfers of Level 3 investments between levels.

Contractual maturity dates of debt securities in the nuclear decommissioning fund as of June 30, 2025:


	Final Contractual Maturity
(Millions of Dollars)	Due in 1 Year or Less		Due in 1 to 5 Years		Due in 5 to 10 Years		Due after 10 Years		Total
Debt securities	$	14	$	327	$	258	$	275	$	874

Derivative Activities and Fair Value Measurements

NSP-Minnesota enters into derivative instruments, including forward contracts, futures, swaps and options, for trading purposes and to manage risk in connection with changes in interest rates and utility commodity prices.

Interest Rate Derivatives — NSP-Minnesota enters into contracts that effectively fix the interest rate on a specified principal amount of a hypothetical future debt issuance. These financial swaps net settle based on changes in a specified benchmark interest rate, acting as a hedge of changes in market interest rates that will impact specified anticipated debt issuances. These derivative instruments are designated as cash flow hedges for accounting purposes, with changes in fair value prior to occurrence of the hedged transactions recorded as other comprehensive income.

As of June 30, 2025, accumulated other comprehensive loss related to interest rate derivatives included immaterial net losses expected to be reclassified into earnings during the next 12 months as the hedged transactions impact earnings. As of June 30, 2025, NSP-Minnesota had had no unsettled interest swaps outstanding.

See Note 10 for the financial impact of qualifying interest rate cash flow hedges on NSP-Minnesota’s accumulated other comprehensive loss included in the consolidated statements of common stockholder’s equity and in the consolidated statements of comprehensive income.

Wholesale and Commodity Trading — NSP-Minnesota conducts various wholesale and commodity trading activities, including the purchase and sale of electric capacity, energy, energy-related instruments and natural gas-related instruments, including derivatives. NSP-Minnesota is allowed to conduct these activities within guidelines and limitations as approved by its risk management committee, comprised of management personnel not directly involved in the activities governed by this policy.

Results of derivative instrument transactions entered into for trading purposes are presented in the consolidated statements of income as electric revenues, net of any sharing with customers. These activities are not intended to mitigate commodity price risk associated with regulated electric and natural gas operations. Sharing of these margins is determined through state regulatory proceedings as well as the operation of the FERC-approved joint operating agreement.

Commodity Derivatives — NSP-Minnesota enters into derivative instruments to manage variability of future cash flows from changes in commodity prices in its electric and natural gas operations. This could include the purchase or sale of energy or energy-related products, natural gas to generate electric energy, natural gas for resale and FTRs.

The most significant derivative positions outstanding at June 30, 2025 for this purpose relate to FTR instruments administered by MISO. These instruments are intended to offset the impacts of transmission system congestion.

Changes in Level 3 commodity derivatives:


	Three Months Ended June 30
(Millions of Dollars)	2025		2024
Balance at April 1	$	15	$	39
Purchases (a)	62		72
Settlements (a)	(13)		(27)
Net transactions recorded during the period:
(Losses) gains recognized in earnings (b)	(6)		3
Net gains recognized as regulatory assets and liabilities (a)	—		6
Balance at June 30	$	58	$	93

	Six Months Ended June 30
(Millions of Dollars)	2025		2024
Balance at Jan. 1	$	32	$	51
Purchases (a)	62		72
Settlements (a)	(22)		(42)
Net transactions recorded during the period:
(Losses) gains recognized in earnings (b)	(8)		3
Net (losses) gains recognized as regulatory assets and liabilities (a)	(6)		9
Balance at June 30	$	58	$	93

(a)Relates primarily to FTR instruments administered by MISO.

(b)Relates to commodity trading and is subject to substantial offsetting losses and gains on derivative instruments categorized as levels 1 and 2 in the consolidated income statement. See above tables for the income statement impact of derivative activity, including commodity trading gains and losses.

Fair Value of Long-Term Debt

As of June 30, 2025, other financial instruments for which the carrying amount did not equal fair value:


	June 30, 2025				Dec. 31, 2024
(Millions of Dollars)	Carrying Amount		Fair Value		Carrying Amount		Fair Value
Long-term debt, including current portion	$	8,815	$	7,854	$	7,857	$	6,755
Long-term debt - related parties	294		182		166		99

Fair value of NSP-Minnesota’s long-term debt is estimated based on recent trades and observable spreads from benchmark interest rates for similar securities. Fair value estimates are based on information available to management as of June 30, 2025 and Dec. 31, 2024, and given the observability of the inputs, fair values presented for long-term debt were assigned as Level 2.


8. Benefit Plans and Other Postretirement Benefits

Components of Net Periodic Benefit Cost


	Three Months Ended June 30
	2025		2024		2025		2024
(Millions of Dollars)	Pension Benefits				Postretirement Health Care Benefits
Service cost	$	5	$	6	$	—	$	—
Interest cost (a)	9		8		1		—
Expected return on plan assets (a)	(11)		(12)		—		—

Amortization of net loss (a)	3		3		—		—
Settlement charge (b)	—		31		—		—
Net periodic benefit cost	6		36		1		—
Effects of regulation	2		(32)		—		—
Net benefit cost recognized for financial reporting	$	8	$	4	$	1	$	—

	Six Months Ended June 30
	2025		2024		2025		2024
(Millions of Dollars)	Pension Benefits				Postretirement Health Care Benefits
Service cost	$	10	$	11	$	—	$	—
Interest cost (a)	18		17		2		1
Expected return on plan assets (a)	(22)		(23)		—		—

Amortization of net loss (a)	6		6		—		—
Settlement charge (b)	—		31		—		—
Net periodic benefit cost	12		42		2		1
Effects of regulation	4		(29)		—		—
Net benefit cost recognized for financial reporting	$	16	$	13	$	2	$	1

(a)The components of net periodic cost other than the service cost component are included in the line item “Other income, net” in the consolidated statements of income or capitalized on the consolidated balance sheets as a regulatory asset.

(b)A settlement charge is required when the amount of lump-sum distributions during the year is greater than the sum of the service and interest cost components of the annual net periodic pension cost. In the second quarter of 2024, as a result of lump-sum distributions during the 2024 plan year, NSP-Minnesota recorded a pension settlement charge of $31 million, which was not recognized in earnings due to the effects of rate making.

In January 2025, contributions totaling $125 million were made across Xcel Energy’s pension plans, of which $54 million was attributable to NSP-Minnesota. Xcel Energy does not expect additional pension contributions during 2025.


9. Commitments and Contingencies

Legal

NSP-Minnesota is involved in various litigation matters in the ordinary course of business. The assessment of whether a loss is probable or is a reasonable possibility, and whether the loss or a range of loss is estimable, often involves a series of complex judgments about future events. Management maintains accruals for losses probable of being incurred and subject to reasonable estimation. Management is sometimes unable to estimate an amount or range of a reasonably possible loss in certain situations, including but not limited to when (1) the damages sought are indeterminate, (2) the proceedings are in the early stages, or (3) the matters involve novel or unsettled legal theories.

In such cases, there is considerable uncertainty regarding the timing or ultimate resolution, including a possible eventual loss. For current proceedings not specifically reported herein, management does not anticipate that the ultimate liabilities, if any, would have a material effect on NSP-Minnesota’s consolidated financial statements. Legal fees are generally expensed as incurred.

Rate Matters and Other

NSP-Minnesota is involved in various regulatory proceedings arising in the ordinary course of business. Until resolution, typically in the form of a rate order, uncertainties may exist regarding the ultimate rate treatment for certain activities and transactions. Amounts have been recognized for probable and reasonably estimable losses that may result. Unless otherwise disclosed, any reasonably possible range of loss in excess of any recognized amount is not expected to have a material effect on the consolidated financial statements.

Prairie Island Outage Prudency Review — In March 2024, NSP-Minnesota filed its annual fuel clause adjustment true-up petition to the MPUC. In a response to that petition, intervenors recommended refunds for replacement power costs related to an outage at the Prairie Island generating station (October 2023 through February 2024).

In a September 2024 decision, the MPUC ruled NSP-Minnesota was imprudent in the operation of the Prairie Island nuclear plant based on an incident that resulted in the extended outage. The MPUC did not quantify the refund and referred the determination of the refund amount to the Office of Administrative Hearings. NSP-Minnesota recorded an estimated liability for a customer refund in 2024.

In May 2025, in the resulting case currently before an ALJ to determine the refund amount, NSP-Minnesota submitted testimony asserting that no more than $6 million of customer refunds are warranted for the outage.

In July 2025, intervenor testimony was filed by the DOC, OAG, and XLI. These parties, together with the CUB, also filed a joint motion requesting the ALJ rule that customer refunds cannot be adjusted as proposed by NSP-Minnesota, including certain reductions for avoided future outages. If the most recent DOC and OAG recommendations are applied to both 2023 and 2024, NSP-Minnesota estimates that the customer refunds would be approximately $34 million.

Rebuttal testimony is due in August 2025, with an ALJ report expected in March 2026 and an MPUC decision expected in the second quarter of 2026.

Environmental

New and changing federal and state environmental mandates can create financial liabilities for NSP-Minnesota, which are normally recovered through the regulated rate process.

Site Remediation

Various federal and state environmental laws impose liability where hazardous substances or other regulated materials have been released to the environment. NSP-Minnesota may sometimes pay all or a portion of the cost to remediate sites where past activities of their predecessors or other parties have caused environmental contamination.

Environmental contingencies could arise from various situations, including sites of former MGPs; and third-party sites, such as landfills, for which NSP-Minnesota is alleged to have sent wastes to that site.

MGP, Landfill and Disposal Sites

NSP-Minnesota is investigating, remediating or performing post-closure actions at seven historical MGP, landfill or other disposal sites across its service territories.

NSP-Minnesota has approximately $1 million of remaining liabilities for resolution of these issues, however, the final outcome and timing are unknown. In addition, there may be regulatory recovery, insurance recovery and/or recovery from other potentially responsible parties, offsetting a portion of costs incurred.

Water and Waste

Coal Ash Regulation — NSP-Minnesota is subject to the CCR Rule, which imposes requirements for handling, storage, treatment and disposal of coal ash and other solid waste.

In May 2024, final amendments to the CCR Rule were published, widening its scope to include legacy CCR surface impoundments at inactive facilities and previously exempt areas where CCR was placed directly on land at CCR-regulated facilities, including areas of beneficial use.

As a requirement of the CCR Rule, utilities must complete facility evaluations and groundwater sampling around their subject landfills, surface impoundments and certain other areas where coal ash was placed on land.

If certain impacts to groundwater are detected, utilities are required to perform additional groundwater investigations and/or perform corrective actions, beginning with an Assessment of Corrective Measures.

NSP-Minnesota expects to incur $6 million for investigations through 2028 to perform required reporting and assess whether corrective actions are necessary. AROs have been recorded for each of these activities, and amounts are expected to be recoverable through regulatory mechanisms.

NSP-Minnesota has also identified coal ash that is expected to be required to be removed from certain closed coal-generating facilities at estimated costs totaling approximately $60 million. AROs have been recorded, with the costs expected to be recoverable through regulatory mechanisms.

NSP-Minnesota continues to perform site investigation activities related to the CCR Rule, which may result in updates to estimated costs as well as identification of additional required corrective actions.

In July 2025, the EPA issued a proposed rule amending the CCR Legacy rule. The proposal seeks to extend deadlines for various regulatory actions and clarify previous information regarding implementation of the rule. Xcel Energy is reviewing the rule to determine any potential impacts.

Clean Water Act Section 316(b) — The Federal Clean Water Act requires the EPA to regulate cooling water intake structures to assure they reflect the best technology available for minimizing impingement and entrainment of aquatic species.

NSP-Minnesota estimates capital expenditures of approximately $45 million may be required to comply with the requirements. NSP-Minnesota anticipates these costs will be recoverable through regulatory mechanisms.

Air

Clean Air Act NOx Allowance Allocations — In June 2023, the EPA published final regulations for ozone under the “Good Neighbor” provisions of the Clean Air Act that established NOx allowance budgets for fossil fuel-fired electric generating facilities in subject states. The final rule applies to generation facilities in Minnesota, as well as other states outside of our service territory. Compliance would require subject facilities to secure additional allowances, install NOx controls and/or develop a strategy of operations that utilizes the existing allowance allocations.

While the financial impacts of the final rule are uncertain and dependent on market forces and anticipated generation, NSP-Minnesota anticipates the annual costs could be significant, but would be recoverable through regulatory mechanisms.

Leases

NSP-Minnesota evaluates contracts that may contain leases, including PPAs and arrangements for the use of office space, land for solar developments and other facilities, vehicles and equipment. A contract contains a lease if it conveys the exclusive right to control the use of a specific asset.

Components of lease expense:


	Three Months Ended June 30
(Millions of Dollars)	2025		2024
Operating leases
PPA capacity payments	$	25	$	25
Other operating leases (a)	3		3
Total operating lease expense (b)	$	28	$	28

(a)Includes immaterial short-term lease expense.

(b)PPA capacity payments are included in electric fuel and purchased power on the consolidated statements of income. Expense for other operating leases is included in O&M expense and electric fuel and purchased power.


	Six Months Ended June 30
(Millions of Dollars)	2025		2024
Operating leases
PPA capacity payments	$	50	$	48
Other operating leases (a)	9		8
Total operating lease expense (b)	$	59	$	56

(a)Includes immaterial short-term lease expense.

Commitments under operating leases as of June 30, 2025:


(Millions of Dollars)	PPA Operating Leases		Other Operating Leases		Total Operating Leases
Total minimum obligation	$	252	$	251	$	503
Interest component of obligation	(16)		(122)		(138)
Present value of minimum obligation	$	236	$	129	365
Less current portion					(100)
Noncurrent operating lease liabilities					$	265

Variable Interest Entities

Under certain PPAs, NSP-Minnesota purchases power from IPPs for which NSP-Minnesota is required to reimburse fuel costs, or to participate in tolling arrangements under which NSP-Minnesota procures the natural gas required to produce the energy that it purchases. NSP-Minnesota has determined that certain IPPs are VIEs, however NSP-Minnesota is not subject to risk of loss from the operations of these entities, and no significant financial support is required other than contractual payments for energy and capacity.

NSP-Minnesota evaluated each of these VIEs for possible consolidation, including review of qualitative factors such as the length and terms of the contract, control over O&M, control over dispatch of electricity, historical and estimated future fuel and electricity prices and financing activities. NSP-Minnesota concluded that these entities are not required to be consolidated in its consolidated financial statements because NSP-Minnesota does not have the power to direct the activities that most significantly impact the entities’ economic performance.

NSP-Minnesota had 1,347 MW of capacity under long-term PPAs at both June 30, 2025 and Dec. 31, 2024, with entities that have been determined to be VIEs. These agreements have expiration dates through 2039.


11. Segment Information

Segment information and reconciliation to NSP-Minnesota’s consolidated net income:


	Three Months Ended June 30, 2025
(Millions of Dollars)	Regulated electric utility		Regulated natural gas utility		Total segments
Operating revenues (a)	$	1,336	$	110	$	1,446
Intersegment revenue	—		4		4
Total segment revenues	1,336		114		1,450
Electric fuel and purchased power	465		—		465
Cost of natural gas sold and transported	—		45		45
O&M expenses	313		28		341
Depreciation and amortization	264		21		285
Other segment expenses, net	65		14		79
Interest charges and financing costs	83		10		93
Income tax benefit	(40)		(2)		(42)
Net income (loss)	$	186	$	(2)	$	184

Total segment net income					$	184
Non-segment net income					5
Consolidated net income					$	189

(a)Regulated electric results include $120 million of affiliate revenues. Regulated natural gas results include an immaterial amount of affiliate revenues.


	Three Months Ended June 30, 2024
(Millions of Dollars)	Regulated electric utility		Regulated natural gas utility		Total segments
Operating revenues (a)	$	1,237	$	90	$	1,327


Electric fuel and purchased power	464		—		464
Cost of natural gas sold and transported	—		23		23
O&M expenses	300		28		328
Depreciation and amortization	251		19		270
Other segment expenses, net	74		8		82
Interest charges and financing costs	77		8		85
Income tax benefit	(51)		—		(51)
Net income	$	122	$	4	$	126

Total segment net income					$	126
Non-segment net income					5
Consolidated net income					$	131

(a)Regulated electric results include $120 million of affiliate revenues. Regulated natural gas results include an immaterial amount of affiliate revenues.


	Six Months Ended June 30, 2025
(Millions of Dollars)	Regulated electric utility		Regulated natural gas utility		Total segments
Operating revenues (a)	$	2,630	$	470	$	3,100
Intersegment revenue	—		6		6
Total segment revenues	2,630		476		3,106
Electric fuel and purchased power	960		—		960
Cost of natural gas sold and transported	—		261		261
O&M expenses	634		53		687


Depreciation and amortization	535		43		578
Other segment expenses, net	135		39		174
Interest charges and financing costs	163		16		179
Income tax (benefit) expense	(114)		16		(98)
Net income	$	317	$	48	$	365






Total segment net income					$	365
Non-segment net income					8
Consolidated net income					$	373

(a)Regulated electric results include $242 million of affiliate revenues. Regulated natural gas results include an immaterial amount of affiliate revenues.


	Six Months Ended June 30, 2024
(Millions of Dollars)	Regulated electric utility		Regulated natural gas utility		Total segments
Operating revenues (a)	$	2,492	$	363	$	2,855
Intersegment revenue	—		1		1
Total segment revenues	2,492		364		2,856
Electric fuel and purchased power	923		—		923
Cost of natural gas sold and transported	—		162		162
O&M expenses	585		52		637


Depreciation and amortization	500		38		538
Other segment expenses, net	164		23		187
Interest charges and financing costs	153		15		168
Income tax (benefit) expense	(100)		19		(81)
Net income	$	267	$	55	$	322






Total segment net income					$	322
Non-segment net income					20
Consolidated net income					$	342

(a)Regulated electric results include $242 million of affiliate revenues. Regulated natural gas results include an immaterial amount of affiliate revenues.

Asset and capital expenditure information is not provided for NSP-Minnesota’s reportable segments. As an integrated electric and natural gas utility, NSP-Minnesota operates significant assets that are not dedicated to a specific business segment.

Reporting assets and capital expenditures by business segment would require arbitrary and potentially misleading allocations, which may not necessarily reflect the assets that would be required for the operation of the business segments on a stand-alone basis.

Certain costs, such as common depreciation, common O&M expenses and interest expense are allocated based on cost causation allocators across each segment. In addition, a general allocator is used for certain general and administrative expenses, including office supplies, rent, property insurance and general advertising.

Other segment expenses, net, for the reportable segments includes conservation and DSM expenses, taxes (other than income taxes), other income, net, intersegment expenses and AFUDC - equity.

ITEM 2 — MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Discussion of financial condition and liquidity for NSP-Minnesota is omitted per conditions set forth in General Instructions H(1)(a) and (b) of Form 10-Q for wholly owned subsidiaries. It is replaced with management’s narrative analysis of the results of operations set forth in General Instruction H(2)(a) of Form 10-Q for wholly owned subsidiaries (reduced disclosure format).

Non-GAAP Financial Measures

The following discussion includes financial information prepared in accordance with GAAP, as well as certain non-GAAP financial measures such as ongoing earnings. Generally, a non-GAAP financial measure is a measure of a company’s financial performance, financial position or cash flows that adjusts measures calculated and presented in accordance with GAAP.

NSP-Minnesota’s management uses non-GAAP measures for financial planning and analysis, for reporting of results to the Board of Directors, in determining performance-based compensation, and communicating its earnings outlook to analysts and investors. Non-GAAP financial measures are intended to supplement investors’ understanding of our performance and should not be considered alternatives for financial measures presented in accordance with GAAP. These measures are discussed in more detail below and may not be comparable to other companies’ similarly titled non-GAAP financial measures.

Earnings Adjusted for Certain Items (Ongoing Earnings)

Ongoing earnings reflect adjustments to GAAP earnings (net income) for certain items.

We use this non-GAAP financial measure to evaluate and provide details of NSP-Wisconsin’s core earnings and underlying performance. We believe this measurement is useful to investors to evaluate the actual and projected financial performance and contribution of NSP-Minnesota. For the three and six months ended June 30, 2025 and 2024, there were no such adjustments to GAAP earnings and therefore GAAP earnings equal ongoing earnings.


Results of Operations

NSP-Minnesota’s GAAP net income was $373 million for the six months ended June 30, 2025 compared with $342 million for the prior year. The change was driven by higher recovery of electric infrastructure investments partially offset by increased O&M expenses, depreciation and interest charges.

Electric Revenue

Electric revenues are impacted by fluctuations in the price of natural gas, coal and uranium, regulatory outcomes, market prices and seasonality. In addition, electric customers receive a credit for PTCs generated, which reduce electric revenue and income taxes.


(Millions of Dollars)	Six Months Ended June 30, 2025 vs. 2024
Regulatory rate outcomes	$	44
Non-fuel riders	38
Recovery of higher electric fuel and purchased power expenses	22
Wholesale generation revenues	12
Sales and demand	12
Electric transmission revenues	11
Conservation and DSM (offset in expense)	(33)


Other, net	32
Total increase	$	138

Natural Gas Revenues

Natural gas revenues vary with changing sales, the cost of natural gas and regulatory outcomes.


(Millions of Dollars)	Six Months Ended June 30, 2025 vs. 2024
Recovery of higher natural gas costs (sold and transported)	$	96
Conservation revenue (offset in expense)	12



Other, net	(1)
Total increase	$	107

Electric Fuel and Purchased Power — Expenses incurred for electric fuel and purchased power are impacted by fluctuations in market prices of natural gas, coal and uranium, as well as seasonality. These incurred expenses are generally recovered through various regulatory recovery mechanisms. As a result, changes in these expenses are largely offset in operating revenues and have minimal earnings impact.

Electric fuel and purchased power expenses increased $37 million year-to-date. The increase was primarily due to increased commodity pricing and volumes.

Cost of Natural Gas Sold and Transported — Expenses incurred for the cost of natural gas sold are impacted by market prices and seasonality. These costs are generally recovered through various regulatory recovery mechanisms. As a result, changes in these expenses are largely offset in operating revenues and have minimal earnings impact.

Natural gas sold and transported increased $99 million year-to-date. The increase was primarily due to timing of fuel recovery mechanisms as well as increased commodity prices and volumes.

Non-Fuel Operating Expenses and Other Items

O&M Expenses — O&M expenses increased $63 million year-to-date. The increase was primarily due to higher nuclear generation costs, the impact of a 2024 gain on land sale and increased benefits and insurance costs.

Depreciation and Amortization — Depreciation and amortization expense increased $39 million year-to-date, which was largely the result of system investment.

Interest Charges — Interest charges increased $17 million year-to-date, which was largely due to higher debt levels and interest rates.

Public Utility Regulation and Other

The FERC and various state and local regulatory commissions regulate NSP-Minnesota. NSP-Minnesota is subject to rate regulation by state utility regulatory agencies, which have jurisdiction with respect to the rates of electric and natural gas distribution companies in Minnesota, North Dakota and South Dakota.

Rates are designed to recover plant investment, operating costs and an allowed return on investment. NSP-Minnesota requests changes in utility rates through commission filings. Changes in operating costs can affect NSP-Minnesota’s financial results, depending on the timing of rate cases and implementation of final rates. Other factors affecting rate filings are new investments, sales, conservation and demand side management efforts, and the cost of capital.

In addition, the regulatory commissions authorize the ROE, capital structure and depreciation rates in rate proceedings. Decisions by these regulators can significantly impact NSP-Minnesota’s results of operations.

Except to the extent noted below, the circumstances set forth in Public Utility Regulation included in Item 7 of NSP-Minnesota’s Annual Report on Form 10-K for the year ended Dec. 31, 2024 appropriately represent, in all material respects, the current status of public utility regulation and are incorporated herein by reference.

Pending and Recently Concluded Regulatory Proceedings

2022 Minnesota Electric Rate Case — In October 2021, NSP-Minnesota filed a three-year electric rate case with the MPUC.

In July 2023, the MPUC approved a three-year rate increase of approximately $332 million for 2022-2024, based on a ROE of 9.25% and an equity ratio of 52.5%. The MPUC also approved a continuation of the sales true-up mechanism.

In November 2023, NSP-Minnesota filed an appeal to the Minnesota Court of Appeals regarding MPUC decisions relating to executive compensation, insurance expense and treatment of prepaid pension assets.

In January 2025, the Court issued its opinion, which upheld the commission's determination on insurance expense, but reversed and remanded the executive compensation and prepaid pension asset decisions back to the MPUC. In June 2025, the MPUC ordered proceedings to reconsider the treatment of prepaid pension assets and executive compensation, with the procedural schedule expected to be established in the third quarter of 2025.

2024 Minnesota Electric Rate Case — In November 2024, NSP-Minnesota filed an electric rate case in Minnesota, seeking a total revenue increase of $491 million (13.2%) over two years, based on an ROE of 10.3%, a 52.5% equity ratio and rate base of $13.2 billion in 2025 and $14 billion in 2026. NSP-Minnesota also requested interim rates of $224 million for 2025. In December 2024, the MPUC reduced the interim rate request for wildfire mitigation costs (as these costs were deemed as new costs not previously approved in a rate case) and approved interim rates of $192 million, effective January 1, 2025.

In March 2025, NSP-Minnesota filed supplemental direct testimony, updating its total revenue request to $473 million. The procedural schedule is as follows:

•Intervenor direct testimony: August 22, 2025

•Rebuttal testimony: October 10, 2025

•ALJ Report: April 30, 2026

•MPUC Decision: July 31, 2026

2025 South Dakota Electric Rate Case — In June 2025, NSP-Minnesota filed a request with the SDPUC for a net annual electric rate increase of $44 million (15%). The filing is based on a 2024 historic test year, a requested ROE of 10.3%, rate base of approximately $1.2 billion and an equity ratio of 52.87%. NSP-Minnesota has requested rates to begin on Jan. 1, 2026. If approved as filed, this rate request would result in an average annual residential bill increase of 3% over the period from 2016-2026.

2024 North Dakota Electric Rate Case — In December 2024, NSP-Minnesota filed a request with the NDPSC for an annual electric rate increase of approximately $45 million, or 19.3% over current rates established in 2021. The filing is based on a 2025 forecast test year and includes a requested ROE of 10.3%, rate base of approximately $817 million and an equity ratio of 52.5%. In January 2025, the NDPSC approved interim rates, subject to refund, of approximately $27 million (implemented on Feb. 1, 2025).

On July 8, 2025, two intervenors filed testimony with a range of recommendations. NDPSC Staff recommended an increase of approximately $30 million, with a 9.41% ROE and a 50% equity ratio, along with other proposed adjustments that were not quantified. NSP-Minnesota estimates the NDPSC Staff recommendation would result in a rate increase of $20 million to $25 million. NSP-Minnesota will address these proposals in rebuttal testimony in the third quarter of 2025. A NDPSC decision is expected in early 2026.

NSP System

Resource Acquisition — In February 2024, NSP filed its Upper Midwest Resource Plan with the MPUC. In October 2024, NSP-Minnesota filed a settlement with several parties reaching agreement on the resource plan, as well as the proposed projects to be approved in the pending 800 MW firm dispatchable resource acquisition.

In February 2025, the MPUC approved the terms of the settlement agreement, including:

•The selection of the company owned 420 MW Lyon County combustion turbine.

•The selection of the company owned 300 MW 4-hour Sherco battery energy storage system.

•Multiple PPAs to proceed to the negotiation stage.

•The addition of 3,200 MW of wind, 400 MW of solar and 600 MW of stand-alone storage to be added through 2030 based on an RFP process (a portion of which is expected to be fulfilled with the resources acquired as part of the 2024 RFPs). Of these amounts, approximately 2,800 MW of wind are projected to utilize the Minnesota Energy Connection transmission line.

•Planned life extensions of the Prairie Island and Monticello nuclear plants through the early 2050s.

Additionally, the MPUC approved life extensions of the Red Wing and Mankato RDF plants to 2037 and ordered NSP-Minnesota to file a proposed tariff for customers with super-large load, largely data centers, which was filed in July 2025.

NSP-Minnesota will file additional RFPs for approved resource needs beginning in late 2025 or early 2026.

NSP-Minnesota and NSP-Wisconsin are actively engaged in multiple processes and proceedings to acquire resources to meet their identified generation resource needs.

•In October 2023, NSP-Minnesota issued an RFP seeking 1,200 MW of wind assets to replace capacity and reutilize interconnection rights associated with the retiring Sherco coal facilities. The RFP closed in December 2023. NSP-Minnesota expects to file for approval of recommended projects in early 2026.

•In 2024, NSP-Minnesota and NSP-Wisconsin each issued an RFP collectively seeking up to 1,600 MW of wind, solar, storage or hybrid resources to interconnect to the NSP System, including reutilization of the interconnection rights associated with the retiring Sherco coal units, and 650 MW of solar and storage resources to specifically reutilize the interconnection rights associated with the retiring King coal unit. NSP-Minnesota and NSP-Wisconsin announced the short listed projects in January 2025 and plan to file for the requisite approvals of the selected resources with the MPUC and PSCW, respectively, in the second half of 2025.

Other

Supply Chain

NSP-Minnesota’s ability to meet customer energy requirements and growing customer demand, respond to storm-related disruptions, and execute our capital expenditure program are dependent on maintaining an efficient supply chain.

Large global demand for energy-related infrastructure has stretched equipment supply chains, extended delivery dates and increased prices for items like combustion turbines, transformers and other large electrical equipment. The labor market for skilled engineering and construction resources to build renewables and gas generation has also been strained, impacting cost and availability.

In addition, manufacturing processes have experienced disruptions related to the scarcity of certain raw materials and interruptions in production and shipping. The impact of inflationary pressures, geopolitical events and federal policies have exacerbated the situation. NSP-Minnesota continues to monitor the situation as it remains fluid and seeks to mitigate the impacts by securing alternative suppliers and key vendor partners, increasing procurement lead times, modifying design standards, and adjusting the timing of work.

Tariffs, Trade Complaints and Federal Actions

Several trade cases related to anti-dumping and countervailing duty investigations of CSPV cells are ongoing and we continue to monitor the potential impacts of these cases.

In 2025, several executive orders have been issued imposing new global and country-specific tariffs on many imports, which may impact our procurement and development activities. Additionally, executive orders and actions from government agencies may impact the permitting of wind and solar facilities and the retirement of coal facilities.

NSP-Minnesota continues to assess the impacts of these tariffs, executive orders, trade complaints and federal policies on its business, including company owned projects and PPAs. NSP-Minnesota may seek regulatory relief, if required, in its jurisdictions.

Continued and/or further policy actions or other restrictions, disruptions in imports from key suppliers, or any new trade complaint could impact viability, timelines and costs of various projects and PPAs.

Tax Law Changes

On July 4, 2025, the President signed into law Public Law No. 119-21 (the “OBBB”). The OBBB modifies certain clean energy tax provisions included in the Inflation Reduction Act. The provisions include:

•Eliminating production and investment tax credits for wind and solar facilities placed in service after 2027, for facilities that begin construction after July 4, 2026.

•The addition of foreign entity of concern rules that apply to projects commencing construction after 2025.

NSP-Minnesota does not expect these provisions to have an impact on our 2025-2029 base capital plan as steps have been taken to begin construction under the IRS’ safe harbor guidance.

On July 7, 2025, the White House issued an Executive Order directing the Secretary of the Treasury to issue guidance to ensure that policies concerning the beginning of construction are not circumvented. NSP-Minnesota will continue to assess the impact of future guidance on its projects as well as its PPAs.

Nuclear Antitrust Class Action

A class action complaint was filed in federal court for the District of Maryland in July 2025, alleging violations of the Sherman Antitrust Act in establishing wages for employees at nuclear facilities since 2003. The complaint names 28 defendants, including all 26 owner operators of nuclear facilities in the United States, or affiliated entities, including Xcel Energy Inc. NSP-Minnesota owns and operates two nuclear facilities in Minnesota, and is assessing the complaint.

Environmental Regulation

In March 2025, the EPA announced that the agency will undertake various regulatory actions addressing a wide range of environmental regulations. This includes action on the 2024 power plant greenhouse gas regulations, Effluent Limitation Guidelines, the 2024 amendments to the CCR Rule and the 2023 Good Neighbor Plan. NSP-Minnesota will continue to monitor these proposed rules as they move toward final action. Additionally, any other amendments and changes to rules will be evaluated as proposed by EPA.

Clean Air Act

Power Plant Greenhouse Gas Regulations — In April 2024, the EPA published final rules addressing control of CO2 emissions from the power sector. The rules regulate new natural gas generating units and emission guidelines for existing coal and certain natural gas generation. The rules create subcategories of coal units based on planned retirement date and subcategories of natural gas combustion turbines and combined cycle units based on utilization. The CO2 control requirements vary by subcategory.

Based on current estimates and assumptions, NSP-Minnesota has determined that due to scheduled plant retirements, there is minimal financial or operational impact associated with these requirements and believes that the cost of these initiatives or replacement generation would be recoverable through rates based on prior state commission practices.

In June 2025, the EPA proposed to repeal these and all other GHG emissions standards for the power sector. In the alternative, the EPA proposed to repeal a narrower subset of the 2024 regulations. The EPA provided a 45-day comment period for the proposal.

In July 2025, the EPA additionally proposed to repeal the 2009 Endangerment Finding and associated regulations addressing greenhouse gas emissions under the Clean Air Act. NSP-Minnesota will monitor the proposed rules and evaluate the impacts of any final rule.

Emerging Contaminants of Concern

PFAS are man-made chemicals that are widely used in consumer products and can persist and bio-accumulate in the environment. NSP-Minnesota does not manufacture PFAS, but because PFAS are so ubiquitous in products and the environment, it may impact our operations.

In June 2024, the EPA finalized a rule that designated certain PFAS as hazardous substances under CERCLA. In July 2024, the EPA finalized another rule that set enforceable drinking water standards for certain PFAS.

Potential costs for these rules and any additional proposed regulations related to PFAS are uncertain and will be determined on a site specific basis where applicable. If costs are incurred, NSP-Minnesota believes the costs will be recoverable through rates based on prior state commission practices.

Effluent Limitation Guidelines

In April 2024, the EPA published final rules under the Clean Water Act, setting Effluent Limitations Guidelines and Standards for steam generating coal plants. This rule establishes more stringent wastewater discharge standards for bottom ash transport water, flue-gas desulfurization wastewater, and combustion residuals leachate from steam electric power plants, particularly coal-fired power plants. Based on current estimates and assumptions, NSP-Minnesota has determined that there is minimal financial or operational impact associated with these requirements and that any costs would be recoverable through rates based on prior state commission practices.


ITEM 4 — CONTROLS AND PROCEDURES

Disclosure Controls and Procedures

NSP-Minnesota maintains a set of disclosure controls and procedures designed to ensure that information required to be disclosed in reports that it files or submits under the Securities Exchange Act of 1934 is recorded, processed, summarized, and reported within the time periods specified in SEC rules and forms.

In addition, the disclosure controls and procedures ensure that information required to be disclosed is accumulated and communicated to management, including the CEO and CFO, allowing timely decisions regarding required disclosure.

As of June 30, 2025, based on an evaluation carried out under the supervision and with the participation of NSP-Minnesota’s management, including the CEO and CFO, of the effectiveness of its disclosure controls and procedures, the CEO and CFO have concluded that NSP-Minnesota’s disclosure controls and procedures were effective.

Internal Control Over Financial Reporting

No changes in NSP-Minnesota’s internal control over financial reporting occurred during the most recent fiscal quarter that materially affected, or are reasonably likely to materially affect, NSP-Minnesota’s internal control over financial reporting.

PART II — OTHER INFORMATION


ITEM 1 — LEGAL PROCEEDINGS

Management is sometimes unable to estimate an amount or range of a reasonably possible loss in certain situations, including but not limited to when (1) the damages sought are indeterminate, (2) the proceedings are in the early stages, or (3) the matters involve novel or unsettled legal theories. In such cases, there is considerable uncertainty regarding the timing or ultimate resolution of such matters, including a possible eventual loss.

For current proceedings not specifically reported herein, management does not anticipate that the ultimate liabilities, if any, would have a material effect on NSP-Minnesota’s consolidated financial statements. Legal fees are generally expensed as incurred.

See Note 9 to the consolidated financial statements and Part I Item 2 for further information.


ITEM 1A — RISK FACTORS

NSP-Minnesota’s risk factors are documented in Item 1A of Part I of its Annual Report on Form 10-K for the year ended Dec. 31, 2024, which is incorporated herein by reference. There have been no material changes from the risk factors previously disclosed in the Form 10-K.


ITEM 5 — OTHER INFORMATION

None of the Company’s directors or officers adopted, modified, or terminated a Rule 10b5-1 trading arrangement or a non-Rule 10b5-1 trading arrangement during the Company’s fiscal quarter ended June 30, 2025.


PART I	FINANCIAL INFORMATION
Item 1 —	Financial Statements (Unaudited)	4
	Consolidated Statements of Income	4
	Consolidated Statements of Comprehensive Income	5
	Consolidated Statements of Cash Flows	6
	Consolidated Balance Sheets	7
	Consolidated Statements of Common Stockholder’s Equity	8
	Notes to Consolidated Financial Statements	8
Item 2 —	Management’s Discussion and Analysis of Financial Condition and Results of Operations	20
Item 4 —	Controls and Procedures	23

PART II	OTHER INFORMATION
Item 1 —	Legal Proceedings	23
Item 1A —	Risk Factors	23
Item 5 —	Other Information	23
Item 6 —	Exhibits	24

SIGNATURES		25


Exhibit Number	Description	Report or Registration Statement	Exhibit Reference
3.01*	Articles of Incorporation and Amendments of Northern Power Corp. (renamed NSP-Minnesota on Aug. 21, 2000)	NSP-Minnesota Form 10-12G dated Oct. 5, 2000	3.01
3.02*	Amended and Restated Bylaws of NSP-Minnesota, dated Jan. 25, 2019	NSP-Minnesota Form 10-K for the year ended Dec. 31, 2018	3.02
4.01*	Supplemental Trust Indenture dated as of April 1, 2025 between Northern States Power Company and The Bank of New York Mellon Trust Company, N.A., as successor Trustee, creating $600,000,000 aggregate principal amount of 5.05% First Mortgage Bonds, Series due May 15, 2035 and $500,000,000 aggregate principal amount of 5.65% First Mortgage Bonds, Series due May 15, 2055.	NSP-Minnesota Form 8-K dated May 5, 2025	4.01
10.01*	Fifth Amended and Restated Credit Agreement, dated as of May 6, 2025, among Northern States Power Company, a Minnesota corporation, as Borrower, the several lenders from time to time parties thereto, JPMorgan Chase Bank, N.A., as Administrative Agent, Bank of America, N.A. and Barclays Bank PLC, as Syndication Agents, Citibank, N.A., Mizuho Bank, Ltd., Morgan Stanley Senior Funding, Inc., MUFG Bank, Ltd. and Wells Fargo Bank, National Association, as Documentation Agents and the several lenders party thereto.	Xcel Energy Inc. Form 8-K dated May 6, 2025	99.02
31.01	Principal Executive Officer’s certifications pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.02	Principal Financial Officer’s certifications pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.01	Certifications pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101.INS	Inline XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document
101.SCH	Inline XBRL Schema
101.CAL	Inline XBRL Calculation
101.DEF	Inline XBRL Definition
101.LAB	Inline XBRL Label
101.PRE	Inline XBRL Presentation
104	Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)


		Northern States Power Company (a Minnesota corporation)

July 31, 2025	By:	/s/ MELISSA L. OSTROM
		Melissa L. Ostrom
		Senior Vice President, Controller
		(Principal Accounting Officer)


	By:	/s/ BRIAN J. VAN ABEL
		Brian J. Van Abel
		Executive Vice President, Chief Financial Officer
		(Principal Financial Officer)


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


Northern States Power Company
(Exact Name of Registrant as Specified in its Charter)


	(612)	330-5500
(Registrant’s Telephone Number, Including Area Code)


N/A
(Former name, former address and former fiscal year, if changed since last report)


Class						Outstanding at July 31, 2025
Common Stock, $0.01 par value						1,000,000 shares


(Amounts in Millions) (a)(b)	June 30, 2025	Dec. 31, 2024
Megawatt hours of electricity	47	31
Million British thermal units of natural gas	47	57


	Pre-Tax Fair Value Gains (Losses) Recognized During the Period in:
(Millions of Dollars)	Accumulated Other Comprehensive Loss		Regulatory Assets and Liabilities
Three Months Ended June 30, 2025
Derivatives designated as cash flow hedges:
Interest rate	$	7	$	—
Total	$	7	$	—
Other derivative instruments:
Electric commodity	$	—	$	(2)

Total	$	—	$	(2)

Six Months Ended June 30, 2025
Derivatives designated as cash flow hedges:
Interest rate	$	5	$	—
Total	$	5	$	—
Other derivative instruments:
Electric commodity	$	—	$	(5)
Natural gas commodity	—		1
Total	$	—	$	(4)

Three Months Ended June 30, 2024



Other derivative instruments
Electric commodity	$	—	$	—
Natural gas commodity	—		—
Total	$	—	$	—

Six Months Ended June 30, 2024
Derivatives designated as cash flow hedges:
Interest rate	$	16	$	—
Total	$	16	$	—
Other derivative instruments
Electric commodity	$	—	$	1
Natural gas commodity	$	—	$	3
Total	$	—	$	4


(Millions of Dollars)	Pre-Tax Losses Reclassified During the Period from Regulatory Assets and Liabilities			Pre-Tax Gains (Losses) Recognized During the Period in Income

Three Months Ended June 30, 2025



Other derivative instruments:
Commodity trading	$	—		$	4	(a)
Electric commodity	2		(b)	—

Total	$	2		$	4

Six Months Ended June 30, 2025



Other derivative instruments:
Commodity trading	$	—		$	(8)	(a)
Electric commodity	8		(b)	—
Natural gas commodity	—			(4)		(c)(d)
Total	$	8		$	(12)

Three Months Ended June 30, 2024



Other derivative instruments:
Commodity trading	$	—		$	(14)	(a)
Electric Commodity	2		(b)	—

Total	$	2		$	(14)

Six Months Ended June 30, 2024



Other derivative instruments:
Commodity trading	$	—		$	(13)	(a)
Electric commodity	6		(b)	—
Natural gas commodity	—			(5)		(c)(d)
Total	$	6		$	(18)