# Wa ts on Direct – Revenue Requirement Page 1 

# DOCKET NO. 42004

APP L ICATION OF SOUTHWESTERN

PUBLIC SERVICE COMPANY FOR

AUTHORITY TO CHANGE RATES

AND TO RECONCILE FUEL AND

PURCHASED POWER COSTS FOR

THE PERIOD JANUARY 1, 2010

THROUGH JUNE 30, 2012 §

§

§

§

§

§

§ PUBLIC UTILITY COMMISSION

OF

TEXAS

DIRECT TESTIMONY

of

DANE A. WATSON

on behalf of

SOUTHWESTERN PUBLIC SERVICE COMPANY

(Revenue Requirement)

( Filename : WatsonRRDirect.doc)

Table of Contents

GLOSSARY OF ACRONYMS AND DEFINED TERMS................................................ 3

LIST OF ATTACHMENTS ............................................................................................... 4

I. WITNESS IDENTIFICATION AND QUALIFICATIONS .................................. 5

II. ASSIGNMENT AND SUMMARY OF TESTIMONY AND

RECO MMENDATIONS .................................................................................................... 8

III. DEPRECIATION ANALYSIS PHILOSOPHY ................................................... 10

IV. SPS BOOK DEPRECIATION STUDY ............................................................... 13

A. S UMMARY OF THE 

# SPS S TUDY 

# ....................................................................... 13

B. O VERVIEW OF 

# D EPRECIATION 

# S TUDY 

# M ETHOD 

# .............................................. 15

C. P RODUCTION AND 

# O THER 

# P RODUCTION 

# P LANT 

# .............................................. 17

1. L IFE OF 

# A SSETS 

# .................................................................................. 17

2. N ET 

# S ALVAGE OF 

# P RODUCTION AND 

# O THER 

# P RODUCTION



# A SSETS 

# ............................................................................................... 24

3. D EPRECIATION 

# R ATE FOR 

# P RODUCTION AND 

# O THER



# P RODUCTION 

# A SSETS 

# .......................................................................... 28

D. T RANSMISSION



# , D ISTRIBUTION



# , AND 

# G ENERAL 

# P ROPERTY 

# ............................. 29

1. L IFE OF 

# T RANSMISSION



# , D ISTRIBUTION



# , AND 

# G ENERAL 

# A SSETS 

# ........ 29

# Wa ts on Direct – Revenue Requirement Page 2 

# 2. N ET 

# S ALVAGE 

# R ATES 

# T RANSMISSION



# , D ISTRIBUTION



# , AND



# G ENERAL 

# ............................................................................................ 31

3. D EPRECIATION 

# R ATES FOR 

# T RANSMISSION



# , D ISTRIBUTION



# , AND



# G ENERAL 

# P ROPERTY 

# .......................................................................... 32

E. V INTAGE 

# Y EAR 

# D EPRECIATION OF 

# G ENERAL 

# P LANT 

# A SSETS



# , FERC

A CCOUNTS 

# 391-398........................................................................................ 35

V. CONCLUSION ..................................................................................................... 38

AFFIDAVIT ..................................................................................................................... 39

# Wa ts on Direct – Revenue Requirement Page 3 

# GLOSSARY OF ACRONYMS AND DEFINED TERMS

Ac r onym/Defined Term Meaning

ALG Average Life Group

AR-15 FERC Accounting Release 15

Commission Public Utility Commission of Texas

Depreciation Study SPS Texas Book Depreciation Accrual Rate

Study at June 30, 2013

EEI Edison Electric Institute

Entergy Entergy Texas, Inc.

FERC Federal Energy Regulatory Commission

IEEE Institute of Electrical and Electronics Engineers

SDP Society of Depreciation Professionals

SPS Southwestern Public Service Company, a New

Mexico Corporation

SPR Simulated Plant Record Method

TESCO Texas Electric Services Company

Test Year July 1, 2012 through June 30, 2013

TXU Texas Utilities Electric Company and successor

companies

Xcel Energy Xcel Energy Inc.

# Wa ts on Direct – Revenue Requirement Page 4 

# LIST OF ATTACHMENTS

At t achment Description

DAW-RR-1 List of Appearances before Regulatory Bodies by

Dane A. Watson.

( Filename: DAW-RR-1.xls)

DAW-RR-2 Southwestern Public Service Company – Texas

Book Depreciation Accrural Rate Study at June

30, 2013

( Filename: DAW-RR-2.pdf)

DAW-RR-3(CD) Workpapers to SPS Depreciation Study

( Various native and pdf files provided on CD )

# Wats o n Direct – Revenue Requirement Page 5 

# DIRECT TESTIMONY OF

DAN E A. WATSON

I. WITNESS IDENTIFICATION AND QUALIFICATIONS 1

Q. Please state your name and business address. 2

A. My name is Dane A. Watson. My business address is 1410 Avenue K, Suite 3

1105B, Plano, Texas 75074. 4

Q

. By whom are you employed and in what position? 5

A. I am a Partner of Alliance Consulting Group. Alliance Consulting Group 6

provides consulting and expert services to the utility industry. 7

Q. On whose behalf are you testifying in this proceeding? 8

A. I am filing testimony on behalf of Southwestern Public Service Company 9

(“SPS”), a wholly owned subsidiary of Xcel Energy Inc. (“Xcel Energy”). Xcel 10

Energy is a registered holding company that owns several electric and natural gas 11

utility companies. 1 

# 12

Q

. Please describe your educational background. 13

A. I hold a Bachelor of Science degree in Electrical Engineering from the University 14

of Arkansas at Fayetteville and a Master's Degree in Business Administration 15

from Amberton University. 16

1 

# Xcel Energy is the parent company of four utility operating companies: Northern States Power

Comp any, a Minnesota corporation; Northern States Power Company, a Wisconsin corporation; Public

Service Company of Colorado, a Colorado Corporation; and SPS, a New Mexico Corporation. Xcel

Energy’s natural gas pipeline subsidiary is WestGas InterState, Inc.

# Wa ts on Direct – Revenue Requirement Page 6



# Q. Please describe your professional experience. 1

A

. Since graduation from college in 1985, I have worked in the area of depreciation 2

and valuation. I founded Alliance Consulting Group in 2004 and am responsible 3

for conducting depreciation, valuation, and certain accounting-related studies for 4

clients in various industries. My duties related to depreciation studies include the 5

assembly and analysis of historical and simulated data, conducting field reviews, 6

determining service life and net salvage estimates, calculating annual 7

depreciation, presenting recommended depreciation rates to utility management 8

for its consideration, and supporting such rates before regulatory bodies. 9

My prior employment from 1985 to 2004 was with Texas Utilities Electric 10

Company and successor companies (“TXU”). During my tenure with TXU, I was 11

responsible for, among other things, conducting valuation and depreciation 12

studies for the domestic TXU companies. During that time, I served as Manager 13

of Property Accounting Services and Records Management in addition to my 14

depreciation responsibilities. 15

I have twice been Chair of the Edison Electric Institute (“EEI”) Property 16

Accounting and Valuation Committee and have been Chairman of EEI’s 17

Depreciation and Economic Issues Subcommittee. I am a Registered Professional 18

Engineer in the State of Texas and a Certified Depreciation Professional. I am a 19

Senior Member of the Institute of Electrical and Electronics Engineers (“IEEE”) 20

and served for several years as an officer of the Executive Board of the Dallas 21

Section of IEEE. I am also currently Past-President of the Society of 22

Depreciation Professionals. 23

# Wats o n Direct – Revenue Requirement Page 7



# Q. Do you hold any special certification as a depreciation expert? 1

A. Y es. The Society of Depreciation Professionals (“SDP”) has established national 2

standards for depreciation professionals. The SDP administers an examination 3

and has certain required qualifications to become certified in this field. I met all 4

requirements and hold a Certified Depreciation Professional certification. 5

Q. Have you previously testified at any regulatory commission? 6

A. Yes. I have conducted depreciation studies and filed testimony or testified on 7

depreciation and valuation issues before the Public Utility Commission of Texas 8

(“Commission”), the New Mexico Public Regulation Commission, and numerous 9

other regulatory bodies as listed in my Attachment DAW-RR-1. 10

# Wa ts on Direct – Revenue Requirement Page 8 

# II. ASSIGNMENT AND SUMMARY OF TESTIMONY AND 1

RECOMMENDATIONS 2

Q. What is your assignment in this proceeding? 3

A. The purpose of my testimony is to: 4

• Discuss the recent SPS –Texas Book Depreciation Accrual Rate Study at 5

June 30, 2013, completed for SPS assets (“Depreciation Study”); and 6

• Support and justify the recommended depreciation rate changes for SPS 7

assets for the period between July 1, 2012 and June 30, 2013 (“Test 8

Year”), based on the results of the Depreciation Study. 9

Q. Please summarize your conclusions regarding depreciation rate changes for 10

SPS assets based on the results of the Depreciation Study. 11

A. The Depreciation Study and analysis performed under my supervision fully 12

support SPS’s proposed depreciation rates applied to June 30, 2013 depreciable 13

plant balances for Production plant, Other Production plant, Transmission plant, 14

Distribution plant (Texas only) and General Property plant. The Depreciation 15

Study follows the Commission’s long-standing precedent for Average Life Group 16

(“ALG”) straight-line depreciation. In this way, all customers are charged for 17

their appropriate share of the capital expended for their benefit. In order to ensure 18

intergenerational equities, the Commission should adopt the life, interim 19

retirement characteristics, and net salvage parameters proposed in this study. The 20

Depreciation Study supports a negative five percent net salvage for its Production 21

and Other Production assets, instead of the positive five percent net salvage that is 22

the currently approved rate for SPS. The positive five percent net salvage is not 23

reflective of SPS’s recent experience and negative five percent net salvage is 24

# Wats o n Direct – Revenue Requirement Page 9 

# supported by long-standing Commission precedent. The Depreciation Study also 1

pr o poses updated service lives and accounts for increased removal costs for 2

Transmission and Distribution assets in the proposed depreciation rates. SPS’s 3

depreciation rates should be set at the levels supported in the Depreciation Study 4

in order to recover SPS’s total investment in property over the estimated 5

remaining life of the assets. 6

Q. How is the Depreciation Study used to determine SPS’s depreciation expense 7

for the Test Year? 8

A. SPS uses depreciation rates determined in the Depreciation Study to calculate the 9

appropriate depreciation expense for the Test Year. The information presented in 10

the Depreciation Study is based on June 30, 2013 Test Year depreciable plant 11

balances and all of the conclusions are based on those balances. SPS witness Lisa 12

H. Perkett will discuss the impact of the new depreciation rates on SPS’s Test 13

Year depreciation expense. 14

# Wa ts on Direct – Revenue Requirement Page 10 

# III. DEPRECIATION ANALYSIS PHILOSOPHY 1

Q. Please describe the depreciation analysis philosophy reflected in the current 2

Depreciation Study. 3

A. The objective of any sound depreciation philosophy should be the matching of 4

expense with revenue over the life of the asset. In general, the life of the asset is 5

determined by several factors including the rate of physical deterioration, 6

obsolescence, weather, maintenance, or (in some cases) the economic usefulness 7

of an entire operating unit. The function of depreciation is to recognize the cost 8

of an asset spread over its useful life. Book depreciation techniques should not 9

accelerate or defer the recovery of an asset in comparison to its appropriate useful 10

life. 11

Q. What objective should the Commission strive to achieve in setting 12

depreciation rates? 13

A. The objective of computing depreciation is to ensure that all customers using the 14

assets pay their pro rata share for the investment, including the cost of retirement. 15

This objective is achieved by allocating the cost or depreciable base of a group of 16

assets over the service life of those assets, on a straight-line basis, by charging a 17

portion of the consumption of the assets to each accounting period. 18

Q. Is this objective consistent with Commission rules and historic practice? 19

A. Yes. As evidenced by P.U.C. S UBST



# . R. 25.231(b)(1)(B) and the Commission’s 20

p rior rate decisions, the Commission has a long standing practice of establishing 21

depreciation rates using the straight-line depreciation method based on the actual 22

historic data of the utility. The straight-line method of depreciation operates by 23

# Wa ts on Direct – Revenue Requirement Page 11 

# collecting a pro rata share of the cost of the investment, including removal cost, 1

f

r om all customers that use the asset over its useful life. 2

Q. What is the best evidence that the Commission can rely on to ensure that the 3

cost of certain assets are ratably recovered over the service life of the asset? 4

A. The best evidence is the actual experience of the specific group of assets being 5

analyzed. This evidence is found in the Depreciation Study based on plant 6

investment in service at June 30, 2013. 7

Q. What happens when depreciation rates are not adjusted to reflect the actual 8

life and retirement characteristics of the assets? 9

A. When depreciation rates are set at a level that does not reflect the actual life and 10

retirement characteristics of a utility’s assets, the cost of the asset will not be 11

recovered on a pro rata basis from all customers that use the asset. For example, 12

in instances where the net salvage rate for certain plant accounts is set at a level 13

that is insufficient under current conditions to recover the cost of the asset, SPS 14

will not accrue a reasonable level of removal cost over the useful life of the plant 15

asset. This, in turn, means that future customers will have to pay a 16

disproportionate share of the removal costs to make up for the payment deferrals. 17

Q. Is the situation you just described at issue in this case? 18

A. Yes. Currently, SPS is using a positive five percent net salvage for its Steam 19

Production and Other Production assets. This net salvage percent was adopted in 20

the Unanimous Stipulation in Docket No. 35763 2 

# and remained unchanged in the 21

2 

# In the Matter of the Application of Southwestern Public Service Company for Authority to

Cha nge Rates and to Reconcile Fuel and Purchased Power Costs for 2006 and 2007, and to Provide a

Credit for Fuel Cost Savings , Docket No. 35763 (Jun. 1, 2009).

# Wats o n Direct – Revenue Requirement Page 12 

# stipulations in the next two SPS rate cases in Docket Nos. 38147 3 

# and 40824. 4 

# 1

Fi v e percent positive net salvage is neither reflective of SPS’s recent experience 2

nor the long-standing precedent of this Commission. My proposed depreciation 3

rates return net salvage percentages to negative five percent net salvage rates for 4

Steam and Other Production plant. 5

Q. What actions should be taken in order to remedy the change in dismantling 6

costs and other changes in life and net salvage? 7

A. The Commission should approve SPS’s proposed depreciation rates which more 8

accurately reflect service life and net salvage for SPS’s existing assets. The 9

depreciation rates proposed in the Depreciation Study more accurately reflect 10

SPS’s current experience and future expectations and also allow for the recovery 11

of depreciation expense that has been under-accrued in the past. In addition, 12

adoption of the proposed depreciation rates should ensure, going forward, that 13

current SPS customers pay more of their pro-rata share of the investment over the 14

remaining life of the investment. This ensures that future customers are not 15

unduly burdened by having to pay a disproportionate share of any remaining 16

investment balance for removal costs at the end of the asset’s life. 17

3 

# In the Matter of the Application of Southwestern Public Service Company for Authority to

Chan ge Rates and to Reconcile Fuel and Purchased Power Costs for 2008 and 2009 , Final Order

Approving Stipulation, Docket No. 38147 (Mar. 25, 2011).

4 

# In the Matter of the Application of Southwestern Public Service Company for Authority to

Chan ge Rates and to Reconcile Fuel and Purchased Power Costs for the Period January 1, 2010 Through

June 30, 2012 , Docket No. 40824 (Jun. 19, 2013).

# Wa ts on Direct – Revenue Requirement Page 13 

# IV. SPS BOOK DEPRECIATION STUDY 1



# A. Summary of the SPS Study 2

Q. Have you prepared a Depreciation Study for SPS? 3

A. Yes. I undertook a comprehensive analysis of annual depreciation for SPS that is 4

based on SPS’s depreciable plant in service as of June 30, 2013. The 5

Depreciation Study analyzed the property characteristics of SPS’s Production 6

plant, Other Production plant, Transmission plant, Distribution plant, and General 7

Property plant and proposes depreciation rates for these assets. The study is 8

attached to my testimony as Attachment DAW-RR-2. 9

Q. What depreciation rates are you recommending in this proceeding? 10

A. My recommended depreciation rates for SPS are provided in Appendix A of the 11

Depreciation Study. Based on updated service life and net salvage rates for SPS’s 12

depreciable plant in-service as of June 30, 2013, I derived the appropriate 13

depreciation rates for Production plant, Other Production plant, Transmission 14

plant, Distribution plant (Texas only), and General Property plant. 15

Q. When did the last change in SPS’s depreciation rates occur? 16

A. The last change in SPS’s depreciation rates became effective on January 1, 2009. 17

Those rates were established based on the stipulation agreement in SPS’s 2008 18

rate case, Docket No. 35763. 5 

# Under the stipulation agreement, the depreciation 19

r ates were the rates recommended by the Alliance of Xcel Municipalities. The 20

5 

# Docket No. 35763, Final Order at FoF 18.a (Jun. 2, 2009) and Unanimous Stipulation at § 4(a).

# Wa ts on Direct – Revenue Requirement Page 14 

# stipulation agreement in SPS’s 2010 rate case, in Docket Nos. 38147 6 

# and 40824 1

c o ntinued the use of the rates implemented in Docket No. 35763. 2

Q. Did you present a depreciation study in Docket No. 35763? 3

A. Yes. I presented a depreciation study in my direct testimony in that docket. I also 4

presented a partially updated depreciation study in Docket No. 38147, but it was 5

not a comprehensive update to my depreciation study in Docket No. 35763. I did 6

present a comprehensive depreciation study in Docket No. 40824. However, that 7

case was settled and the existing approved rates from Docket No. 35763 are still 8

being applied. 9

Q. What has changed since your last comprehensive depreciation study? 10

Some life changes were indicated, but net salvage in most of SPS’s assets 11

continues to be much more negative than those reflected in SPS’s current 12

depreciation rates for several reasons. First, SPS has decided not to request actual 13

experience and dismantling cost study estimates for all Production plant, but to 14

request the Commission return to its long-standing precedent of negative five 15

percent for all production plant net salvage. The negative five percent net salvage 16

for Production plant and Other Production plant is supported by the dismantling 17

cost study conducted by TLG Services for SPS’s 2012 rate case (Docket No. 18

40824). Using the negative five percent net salvage would be a first step in 19

setting production plant depreciation rates that will stop deferring the costs and 20

aid SPS in recovering from current customers their pro rata share of costs that is 21

currently serving these customers. 22

6 

# Docket No. 38147, Order at FoF 18.a (Mar. 25, 2011) and Unopposed Stipulation at §V(a).

# Wa ts on Direct – Revenue Requirement Page 15 

# Second, the removal costs for transmission and distribution plant 1

c o ntinues to rise. Life and net salvage were examined for both functions and 2

minor changes in life are recommended. Almost every account in Transmission 3

and Distribution continues to exhibit increased cost of removal resulting in 4

increasingly negative net salvage. SPS’s proposed depreciation rates in this case 5

reflect this reality. 6

Finally, SPS seeks to continue use of Vintage Group Amortization for its 7

General Plant Assets in Federal Energy Regulatory Commission (“FERC”) 8

Accounts 391-398. The only change in depreciation expense in these accounts 9

will come from updated life and net salvage estimates for accounts in that group. 10



# B. Overview of Depreciation Study Method 11

Q. What definition of depreciation did you use in preparing your Depreciation 12

Study and testimony? 13

A. The term “depreciation,” as I use it, is a system of accounting that distributes the 14

cost of assets, less net salvage (if any), over the estimated useful life of the assets 15

in a systematic and rational manner. It is a process of allocation, not valuation. 16

Depreciation expense is systematically allocated to accounting periods over the 17

life of the assets. The amount allocated to any one accounting period does not 18

necessarily represent the loss or decrease in value that will occur during that 19

particular period. Thus, depreciation is considered an expense or cost, rather than 20

a loss or decrease in value. SPS accrues depreciation based on the original cost of 21

all property included in each depreciable plant account. On retirement, the full 22

# Wa ts on Direct – Revenue Requirement Page 16 

# cost of depreciable property, less any net salvage amount, is charged to the 1

d e preciation reserve. 2

Q. Please describe your Depreciation Study approach. 3

A. I conducted the Depreciation Study in four phases, as shown in Attachment 4

DAW-RR-2. The four phases are: Data Collection, Analysis, Evaluation, and 5

Calculation. I began each of the studies by collecting the historical data to be 6

used in the analysis. After the data had been assembled, I performed analyses to 7

determine the life and net salvage percentage for the different property groups 8

being studied. As part of the process for the study I conducted in Docket No. 9

40824, I conferred with field personnel, engineers, and managers responsible for 10

the installation, operation, and removal of the assets to gain their input into the 11

operation, maintenance, and salvage of the assets. Because that process occurred 12

recently, in 2012, that information was also used in this Depreciation Study. The 13

information obtained from field personnel, engineers, and managerial personnel, 14

combined with the study results, is then evaluated to determine how the results of 15

the historical asset activity analysis, in conjunction with SPS’s expected future 16

plans, should be applied. Using all of these resources, I then calculated the 17

depreciation rate for each function. 18

Q. What property is included in the Depreciation Study? 19

A. There are five distinct classes of property in this study: Production, Other 20

Production, Transmission, Distribution (Texas only), and General Property. The 21

Production Plant functional group consists of all structures, boiler plant 22

equipment, turbogenerator equipment, accessory electrical equipment, and other 23

# Wa ts on Direct – Revenue Requirement Page 17 

# miscellaneous assets used to generate electricity at SPS’s gas- and coal-fired 1

p o wer plants. The Other Production function consists of similar assets used at 2

SPS’s combustion turbine facilities. The Transmission plant functional group 3

consists of structures, substations, and transmission lines used in the transmission 4

of energy to the distribution system. The Distribution plant functional group 5

consists of structures, substations, transformers, meters, services, distribution 6

lines, guard lights, and street lighting used in the distribution and end use of 7

energy on the distribution system. The General plant functional group contains 8

facilities associated with the overall operation of the business such as land and 9

water rights, office equipment, and computers rather than with a specific 10

transmission or distribution classification. 11

Q. What depreciation methodology did you use? 12

A. The ALG, straight-line, remaining-life depreciation system, was employed to 13

calculate annual and accrued depreciation in the studies for all plant except small 14

dollar item assets found in FERC Accounts 391-398. The ALG methodology is 15

the same method used in prior studies and has been approved by this Commission 16

in prior dockets both for SPS and other companies within Texas. 17



# C. Production and Other Production Plant 18

1. Life of Assets 19

Q. Please describe the methodology you used to determine life for Production 20

and Other Production plant. 21

A. For Production and Other Production plant, most components are expected to 22

have a retirement date concurrent with the planned retirement date of the 23

# Wa ts on Direct – Revenue Requirement Page 18 

# generating unit. The terminal retirement date refers to the year that each facility 1

w i ll cease operations. The terminal retirement date along with the interim 2

retirement characteristics of the individual assets that will retire prior to the 3

facility ceasing operation, describe the pattern of retirement of the assets that 4

comprise a generating unit. The estimated terminal retirement dates for the 5

various generating units were determined based on consultation with SPS 6

management, financial, and engineering staff and are shown in Attachment 7

DAW-RR-2, Appendix D. Interim retirement curves were used to model the 8

retirement of individual assets within primary plant accounts for each generating 9

unit prior to the terminal retirement of the facility for all steam generating units. 10

Other production facilities were not modeled with an interim retirement curve. 11

Q. What is an interim retirement curve? 12

A. An interim retirement curve projects how many of the assets or units within a 13

facility that are currently in-service will retire each year prior to the final 14

retirement of the whole facility, using historical analysis and judgment. The life 15

span procedure assumes all assets are depreciated (straight-line) for the same 16

number of periods and retire at the same time (the terminal retirement date). 17

Adding interim retirement curves to the procedure reflects the fact that some of 18

the assets at a power plant will not survive to the end of the life of the facility, but 19

will be retired earlier than the terminal life of the facility and should be 20

depreciated (straight-line) over a shorter time frame to match their projected lives. 21

In this study, we analyzed each account separately to estimate an interim 22

retirement curve for FERC Accounts 311-316. Assets in the Other Production 23

# Wats o n Direct – Revenue Requirement Page 19 

# function have very limited retirements, so no interim retirement curve is 1

in c orporated for those units. 2

Q. Has the Commission previously reflected interim retirements in depreciation 3

rates? 4

A. Yes. The Commission included interim retirements in Docket No. 15195. 7 

# 5

Q. H as the Commission made any recent rulings regarding interim retirements? 6

A. Yes. In the Entergy Texas, Inc. (“Entergy”) rate proceeding, Docket No. 39896; 8 

# 7

the Commission excluded interim retirements in the depreciation rate 8

computation. Specifically, the Commission found in its Order on Rehearing, 9

Finding of Fact 100, that “[t]he retirement (actuarial) rate method, rather than the 10

interim retirement method, should be used in the development of production plant 11

depreciation rates.” Also in the Southwestern Electric Power Company rate 12

proceeding, Docket No. 40443; 9 

# the Commission stated in Finding of Fact 195, 13

“[ t]he rate at which interim retirements will be made is not known and 14

measurable. Incorporation of interim retirements would best be done when those 15

retirements are actually made. It is not reasonable to incorporate interim 16

retirements, resulting in a reduction in the depreciation expense of $1 million on a 17

Texas retail basis.” 18

7 

# Application of Texas Utilities Electric Company for the Reconciliation of Fuel Costs, Doc ket No.

15195 (Aug. 26, 1997).

8 

# Application of Entergy Texas Inc. for Authority to Change Rates, Reconcile Fuel Costs, and

Obta in Deferred Accounting Treatment, Docket No. 39896 (Sep. 14, 2012).

9 

# Application of Southwestern Electric Power Company for Authority to Change Rates and

Rec o ncile Fuel Costs , Docket No. 40443 (Oct. 10, 2013).

# Wa ts on Direct – Revenue Requirement Page 20



# Q. Do you agree that interim retirements should be excluded in the depreciation 1

r a te computation? 2

A. No. It is critical to include interim retirements in the depreciation rate 3

computation. 4

Q. W hy is it critical to include interim retirements in the depreciation rate 5

computation? 6

A. Interim retirements model how plant assets are actually retired prior to a terminal 7

retirement of an entire facility. To exclude interim retirements means that in the 8

future all production investment will remain in service for depreciation purposes, 9

until the facility retires, even though some of those assets will be functionally 10

retired. 11

Q. Please give an example of including interim retirements in the depreciation 12

rate computation. 13

A. Consider a plant facility costing $1,000,000 with a 10-year life and negative 10 14

percent net salvage. In that situation, the accrual rate and capital recovery stream 15

would be as shown below. 16

Chart DAW-RR-1 17

Year Plant Retirement Ac c rual

Rate Annual

Accrual Net

Salvage Depreciation

Reserve

1 1,000,000 11.00% 110,000 110,000

2 1,000,000 11.00% 110,000 220,000

3 1,000,000 11.00% 110,000 330,000

4 1,000,000 11.00% 110,000 440,000

5 1,000,000 11.00% 110,000 550,000

6 1,000,000 11.00% 110,000 660,000

7 1,000,000 11.00% 110,000 770,000

8 1,000,000 11.00% 110,000 880,000

9 1,000,000 11.00% 110,000 990,000

10 1,000,000 1,000,000 11.00% 110,000 (100,000) 0

# Wats o n Direct – Revenue Requirement Page 21



# If there was an early retirement of 12 percent of the plant facility at age 6, then the 1

ca p ital recovery would be as follows: 2

Chart DAW-RR-2 3

In this situation, the company’s assets are not fully recovered, thus creating an 4

intergenerational inequity that must be recovered from future customers. 5

Q. What would be the effect of changing the depreciation accrual rate when the 6

interim retirement occurs? 7

A. If the depreciation rate is changed when the interim retirement occurs, the capital 8

recovery pattern would change to the following: 9 Year Plant Retirem

ent Accrual

Rate Annual

Accrual Net

Salvage Depreciation

Reserve

1 1,000,000 11.00% 110,000 110,000

2 1,000,000 11.00% 110,000 220,000

3 1,000,000 11.00% 110,000 330,000

4 1,000,000 11.00% 110,000 440,000

5 1,000,000 11.00% 110,000 550,000

6 1,000,000 120,000 11.00% 110,000 (12,000) 528,000

7 880,000 11.00% 96,800 624,800

8 880,000 11.00% 96,800 721,600

9 880,000 11.00% 96,800 818,400

10 880,000 880,000 11.00% 96,800 (88,000) (52,800)

# Wats o n Direct – Revenue Requirement Page 22 

# Chart DAW-RR-3 1

Ye a r Plant Retirement Accr ual

Rate Annual

Accrual Net

Salvage Depreciation

Reserve

1 1,000,000 11.00% 110,000 110,000

2 1,000,000 11.00% 110,000 220,000

3 1,000,000 11.00% 110,000 330,000

4 1,000,000 11.00% 110,000 440,000

5 1,000,000 11.00% 110,000 550,000

6 1,000,000 120,000 11.00% 110,000 (12,000) 528,000

7 880,000 12.50% 110,000 638,000

8 880,000 12.50% 110,000 748,000

9 880,000 12.50% 110,000 858,000

10 880,000 880,000 12.50% 110,000 (88,000) 0



# Note that the annual accrual rate increases by 13.64 percent after the interim 2

retirement occurs in order to fully recover the investment in the plant. 3

Q. What would be the recovery pattern if interim retirements were included 4

from the plant’s inception? 5

A. The average service life would be modified to reflect an interim retirement. The 6

calculations are as follows. 7

Average service life = (120,000 x 4 +880,000 x 10)/ 1,000,000 = 9.52 8

years. 9

The accrual rate would be (1- net savage percent)/9.52 = 11.55%. 10

The capital recovery stream would be as follows: 11

# Wa ts on Direct – Revenue Requirement Page 23 

# Chart DAW-RR-4 1

Y e ar Plant Retirement Acc rual

Rate Annual

Accrual Net

Salvage Depreciation

Reserve

1 1,000,000 11.55% 115,546 115,546

2 1,000,000 11.55% 115,546 231,092

3 1,000,000 11.55% 115,546 346,639

4 1,000,000 11.55% 115,546 462,185

5 1,000,000 11.55% 115,546 577,731

6 1,000,000 120,000 11.55% 115,546 (12,000) 561,277

7 880,000 11.55% 101,681 662,958

8 880,000 11.55% 101,681 764,639

9 880,000 11.55% 101,681 866,319

10 880,000 880,000 11.55% 101,681 (88,000) 0



# The important point from this example is that unless depreciation rates include a 2

component for retirements that occur during the life of the plant, then the cost 3

those assets will not be fully recovered when the plant is retired. Failing to 4

address the reality of early retirement violates the matching principle and creates 5

intergenerational inequity when assets that are retired and replaced over the 6

plant’s operation are not recovered during the plant’s life. Additionally, reflecting 7

the earlier retirements during the life of the assets allows the depreciation expense 8

for all generations of customers (all else being equal) to be based on the same 9

depreciation rate. 10

Q. Have all production assets for SPS that have been placed in service remained 11

in service until the plant finally retires? 12

A. No. From 1977-2012, SPS has retired approximately $208 million in assets in the 13

production function prior to final plant retirement. That is approximately 12 14

percent of the plant in service in production for FERC Accounts 311-316 as of 15

June 30, 2013. I recommend the Commission re-evaluate the interim retirement 16

# Wa ts on Direct – Revenue Requirement Page 24 

# issue in this proceeding. The depreciation rates I propose for SPS production 1

a s sets incorporate an interim retirement curve model that recognizes the reality 2

that some assets will retire prior to plant retirement date. 3

2. Net Salvage of Production and Other Production Assets 4

Q. What is the significance of net salvage rates for SPS Plant assets? 5

A. In general, net salvage values are the amount received for retired property 6

(salvage) less any costs incurred to sell or remove the property (removal). When 7

salvage exceeds removal (positive net salvage), the net salvage reduces the 8

amount to be depreciated over time. When removal exceeds salvage (negative net 9

salvage), the negative net salvage increases the amount to be depreciated. In this 10

Depreciation Study, the net salvage percentages used is not based on actual 11

experience and dismantling cost estimates but on this Commission’s 12

long-standing precedent of negative five percent for each property account, except 13

land and water rights accounts where a zero percent net salvage is used. 14

Q. What are the currently approved net salvage values for Production and 15

Other Production assets? 16

A. The currently approved net salvage rates for Production and Other Production are 17

positive five percent, with zero percent net salvage for land rights accounts. 18

Those rates were set in the stipulation agreement in Docket No. 35763. 19

Q. What has been the Commission’s practice in approving net salvage 20

percentages for Production and Other Production assets? 21

A. The Commission has historically used negative five percent and zero percent net 22

salvage rates for Production and Other Production, respectively. Most recently, 23

# Wa ts on Direct – Revenue Requirement Page 25 

# the Commission approved a negative five percent net salvage for Production plant 1

i n Docket No. 39896, Entergy’s recent rate case. 10 

# 2

Q. When was the negative five percent first used at the Commission? 3

A. The Commission first used negative five percent in 1978 in Docket No. 1903 11 

# for 4

Tex as Electric Services Company (“TESCO”). The basis for the negative five 5

percent was a study conducted by Electric Bond and Share Co. on two 6

lignite-fueled generating units owned by what would eventually become TXU. 7

The final order in Docket No. 1903 quoted the reason to change to the negative 8

five percent net salvage for production as “to more clearly reflect actual 9

retirement experience of its generating units [TESCO’s proposal of negative five 10

percent] is a more accurate estimate of net salvage values that will be experienced 11

in the future.” 12

Q. What was the basis for the Commission’s approval of zero percent net 13

salvage for Other Production Plant? 14

A. In the mid-1980s, net salvage values for Other Production were based on the 15

specific facts and circumstances surrounding the assets in that function. For 16

example, the first assets in Other Production were small internal combustion 17

engines (similar to a large car engine) with very little removal cost and no costs 18

associated with environmental issues. The facts supported a zero percent net 19

10 

# Docket No. 39896, Order on Rehearing, FoF 101 (Nov. 1, 2012).

11 

# Application of Texas Electric Service Company for Authority to Change Rates and Inquiry by

Pu blic Utility Commission of Texas into Certain Affiliated Transactions of Texas Electric Service

Company, Texas Power and Light, and Dallas Power and Light Company , Docket No. 1903 (Apr. 20,

1979).

# Wa ts on Direct – Revenue Requirement Page 26 

# salvage at that time. In later cases such as Docket No. 11735, 12 

# Texas Utilities 1

El e ctric Company had only a very small number of assets related to leased 2

combustion turbines in the Other Production function. Part of the lease cost was 3

the removal of the combustion turbines at the end of the lease. Again, the facts at 4

that time supported a zero percent net salvage for Other Production. In contrast, 5

in today’s environment, suggesting that a zero percent net salvage rate for SPS is 6

appropriate for its combustion turbine plants is not supportable by the facts 7

surrounding the retirement and removal of those assets. 8

Q. Earlier in your testimony, you stated that the TLG Production Dismantling 9

Cost Study presented in SPS’s 2012 rate case (Docket No. 40824) supports 10

SPS’s proposal to use negative five percent net salvage values for Production 11

and Other Production plant. How does the TLG Production Dismantling 12

Cost Study support SPS’s proposal? 13

A. The TLG Production Dismantling Cost Study represents a more realistic 14

projection of Production and Other Production terminal net salvage values for 15

SPS than do the values reflected in SPS’s current net salvage rates. The TLG 16

Production Dismantling Cost Study is a more accurate estimate of terminal net 17

salvage values that SPS will experience in the future for the following three 18

reasons: 19

1. Over the years, dismantling costs have continued to increase as evidenced 20

by companies filing increasingly negative net salvage studies. Vague 21

suggestions of “productivity increases” have been far outweighed by the 22

12



# . 

# Application of Texas Utilities Electric Company for Authority to Change Rates

, Docket No.

11735 (Jan. 28, 1994).

# Wats o n Direct – Revenue Requirement Page 27 

# costs associated with complying with increasing environmental 1

re g ulations and escalating labor costs required to remove generating plants 2

from service. Companies have become more environmentally 3

sophisticated since the late 1970s. The original 1978 study did not even 4

consider the costs of removing asbestos, transit, and other environmental 5

hazards that now have to be considered at a significant cost. 6

2. The TLG Production Dismantling Cost Study represents a site-specific 7

analysis of every Production facility owned by SPS. Site-specific data for 8

SPS owned assets are far superior to data extrapolated from an analysis 9

with a small sample size (only two lignite-fueled units) that are owned by 10

another company. 11

3. Utility assets typically have a long useful life. When those assets are 12

retired, the cost to demolish and dispose will have increased significantly 13

because of inflation. Ever changing environmental regulations and 14

disposal requirements must also be factored into dismantling cost. 15

However, SPS is requesting only to move from the current positive five percent to 16

a negative five percent as a first step in reflecting the costs needed at the time of 17

retirement of these facilities. 18

Q. Is the use of the Commission precedent negative five percent a conservative 19

representation of the dismantling costs SPS will incur at the end of the lives 20

of its generating assets? 21

A. Yes. The actual cost that SPS will eventually incur will be much higher and at 22

future prices. Given that the generating units are expected to be in service a 23

number of years before retirement and dismantling, the negative five percent used 24

in the study is very conservative. If the estimated costs in 2012 dollars from the 25

TLG dismantling study or the future costs for dismantling were used in the study, 26

the resulting depreciation rates would be significantly higher than those 27

recommended in this filing. 28

# Wa ts on Direct – Revenue Requirement Page 28



# Q. Why would using the TLG Dismantling Study Result in higher depreciation 1

r a tes? 2

A. The TLG study would reflect higher removal costs and therefore more negative 3

net salvage. 4

3. Depreciation Rate for Production and Other Production Assets 5

Q. Please describe the results of the Depreciation Study for Production Plant. 6

A. The results of the analysis conducted in the Depreciation Study, based on the 7

service life of production assets and the revised net salvage rates, resulted in an 8

increase to SPS’s depreciation rates for production plant. SPS’s present 9

depreciation rates were compared to the Depreciation Study recommendations in 10

Appendix B of Attachment DAW-RR-2. The rates proposed for Production assets 11

would be an increase of approximately $22 million, or a 1.3 percent increase in 12

annual depreciation rates, from SPS’s present depreciation rates. Ms. Perkett will 13

discuss the effect of the proposed rates on SPS’s test-year depreciation expense. 14

Q. Please describe the major changes that resulted in the increase. 15

A. The major reason for the increase in depreciation rates is the reflection of a 16

negative five percent net salvage compared to the positive five percent net salvage 17

amounts embedded in current rates. P.U.C. S UBST



# . R. 25.231(b)(1)(B) requires 18

S PS to ratably recover from customers the future cost to remove all assets 19

currently in service on a straight-line basis over the life of the assets. This means 20

that net salvage rates must be calculated in order to allow recovery in current rates 21

of the expected cost to remove the assets that SPS currently has in service over 22

the expected life of those assets. P.U.C. S UBST



# . R. 25.231(b)(1)(B) ensures that 23

# Wa ts on Direct – Revenue Requirement Page 29 

# the cost of the asset, including removal cost, is collected from all customers, both 1

c u rrent and future, that benefit from the use of the asset on an equitable basis. 2

The Commission’s rules and historic practice of using straight-line depreciation to 3

ensure the equitable recovery of removal costs for assets support SPS’s proposed 4

depreciation rates and net salvage amounts. Without proper recognition of 5

removal costs, the concept of straight-line depreciation is also violated as the rates 6

will have to increase at the end of a unit’s life or after the plant has retired to 7

ensure full recovery of costs. 8

Q. Please describe the results of the Depreciation Study for Other Production 9

plant. 10

A. The results of the analysis conducted in the Depreciation Study, based on the 11

service life and the revised net salvage rates, resulted in an increase to SPS’s 12

depreciation rates for Other Production plant. SPS’s present depreciation rates 13

were compared to the Depreciation Study recommendations in Appendix B of 14

Attachment DAW-RR-2. The rates proposed for Other Production assets is an 15

increase of approximately $865,000, or a 0.31 percent increase in annual 16

depreciation rates, from SPS’s present depreciation rates. Ms. Perkett will discuss 17

the effect of the proposed rates on SPS’s test-year depreciation expense. 18



# D. Transmission, Distribution, and General Property 19

1. Life of Transmission, Distribution, and General Assets 20

Q. What is the significance of an asset’s useful life in your Depreciation Study? 21

A. An asset’s useful life is used to determine the remaining life over which the 22

remaining cost (original cost plus or minus net salvage, minus accumulated 23

# Wa ts on Direct – Revenue Requirement Page 30 

# depreciation) can be allocated to normalize the asset’s cost and spread it ratably 1

o v er future periods. 2

Q

. How did you determine the average service lives for each account? 3

A. The establishment of appropriate average service lives for each account within a 4

functional group was determined by using either of two widely accepted 5

depreciation analyses: actuarial analysis or Simulated Plant Record (“SPR”) 6

methods. Because the vintaged data used in actuarial analysis contains more 7

information than the un-aged data used in SPR analysis, actuarial analysis is the 8

preferred analysis tool when there are a sufficient number of transaction years 9

available to model an account. Mass distribution accounts did not contain 10

vintaged transaction history, so SPR analysis was used for these accounts. Graphs 11

and tables supporting the actuarial analysis and SPR analysis and the chosen Iowa 12

Curves (which represent the percentage of property remaining in service at 13

various age intervals) used to determine the average service lives for analyzed 14

accounts are found in the SPS Depreciation Study (Attachment DAW-RR-2) and 15

the workpapers filed in Attachment DAW-RR-3(CD). As detailed in the study, I 16

relied on my judgment to incorporate any differences in the expected future life 17

characteristics of the assets into the selection of lives. The objective of life 18

selection is to estimate the future life characteristics of assets, not simply measure 19

the historical life characteristics. More information can be found in the life 20

analysis section of the SPS Depreciation Study in Attachment DAW-RR-2. 21

# Wats o n Direct – Revenue Requirement Page 31



# Q. Does your Depreciation Study reflect any changes in the useful lives of the 1

Tr a nsmission, Distribution, and General function assets from the lives 2

embedded in the current depreciation rates? 3

A. Yes. As shown in Appendix C of Attachment DAW-RR-2, 17 accounts have 4

increases in life. The greatest change is an increase of 20 years in FERC Account 5

366. There is one account, Account 393 Stores Equipment, where a decrease in 6

life of 10 years is recommended. The lives for the other 14 accounts remained 7

unchanged. 8

2. Net Salvage Rates Transmission, Distribution, and General 9

Q. How did you determine the net salvage rates that you used in your study for 10

Transmission, Distribution, and General property? 11

A. I examined the experience realized by SPS by observing the average net salvage 12

rates for various bands (or combinations) of years. Using averages (such as the 13

5-year average band) allows the smoothing of timing differences between when 14

retirements, removal cost and salvage are booked and smoothes the natural 15

variations between years. By looking at successive average bands, or “rolling 16

bands,” an analyst can see trends in the data that would signal the future net 17

salvage in the account. This examination, in combination with the feedback of 18

SPS personnel related to any changes in operations or maintenance that would 19

affect the future net salvage of SPS, allowed for the selection of the best estimate 20

of future net salvage for each account. 21

# Wa ts on Direct – Revenue Requirement Page 32



# Q. Is this a reasonable method for determining net salvage rates? 1

A

. Yes. This methodology is commonly employed throughout the industry and is the 2

method recommended in authoritative texts. 3

Q. Does your Depreciation Study reflect any change in the net salvage values of 4

the Transmission and Distribution property from the existing net salvage 5

rates embedded in SPS’s current depreciation rates? 6

A. Yes. The net salvage values for both Transmission and Distribution property 7

continue to experience increasing cost of removal and declining gross salvage. 8

The recommended net salvage values used in the calculation of the Transmission 9

and Distribution depreciation rates, along with the current net salvage values for 10

comparison, are listed in Attachment DAW-RR-2, Appendix C with detailed 11

computation in Appendix E-2. Additionally, Attachment DAW-RR-2 contains a 12

detailed net salvage analysis for Transmission and Distribution property, by 13

account 14

3. Depreciation Rates for Transmission, Distribution, and General 15

Property 16

Q. Please describe the results of the Depreciation Study for Transmission plant. 17

A. The results of the analysis conducted in the Depreciation Study, based on the 18

service life of transmission plant and the revised net salvage rates, resulted in an 19

increase to SPS’s depreciation rates for transmission plant. SPS’s present 20

depreciation rates as authorized by the Commission were compared to the 21

Depreciation Study recommendations in Appendix B of Attachment DAW-RR-2. 22

The rates proposed for Transmission assets is an increase of approximately 23

$309,000, or an approximately 0.0228 percent increase in annual depreciation 24

# Wa ts on Direct – Revenue Requirement Page 33 

# rates, from SPS’s present depreciation rates. Ms. Perkett will discuss the effect of 1

t h e proposed rates on SPS’s test-year depreciation expense. 2

Q. Please describe the results of the Depreciation Study for Distribution plant. 3

A. The results of the analysis conducted in the Depreciation Study, based on the 4

service life of distribution plant (Texas only) and the revised net salvage rates, 5

resulted in a decrease to SPS’s depreciation rates for distribution plant. SPS’s 6

present depreciation rates as authorized by the Commission were compared to the 7

proposed Depreciation Study recommendations in Appendix B of Attachment 8

DAW-RR-2. The rates proposed for Distribution assets is an increase of 0.10 9

percent from SPS’s present depreciation rates. Ms. Perkett will discuss the effect 10

of the proposed rates on SPS’s test-year depreciation expense. 11

Q. Please describe the results of the Depreciation Study for FERC Accounts 12

389-390 (land rights, and structures and improvements). 13

A. The results of the analysis conducted in the Depreciation Study, based on the 14

service life of FERC Accounts 389-390 and the revised net salvage rates, resulted 15

in an increase to SPS’s depreciation rates for FERC Accounts 389-390. SPS’s 16

present depreciation rates as authorized by the Commission were compared to the 17

proposed Depreciation Study recommendations in Appendix B of Attachment 18

DAW-RR-2. The rates proposed for FERC Accounts 389 - 390 would be an 19

increase of $861,000, or an approximate 1.4 percent increase in annual 20

depreciation rates, from SPS’s present depreciation rates. Ms. Perkett will discuss 21

the effect of the proposed depreciation rates on SPS’s test-year depreciation 22

expense. 23

# Wats o n Direct – Revenue Requirement Page 34



# Q. Please describe the major changes that resulted in the changes in 1

de p reciation rates for electric Transmission and Distribution property. 2

A. Changes in service life, gross salvage, gross removal costs, curve selection, and 3

adjustments due to a theoretical reserve comparison are all factors that affect the 4

calculation of the depreciation accrual. The proposed changes in the Depreciation 5

Study analysis for Transmission and Distribution assets suggest adjustments that 6

both increase and decrease the total accrual. However, one of the factors 7

influenced the accrual calculation notably and consistently in one direction: most 8

of the increase in depreciation expense for Transmission and Distribution assets 9

can be attributed to the effect of changes to net salvage rates. 10

In Docket No. 38147, the stipulation did not move net salvage rates to 11

accurate levels. For nearly every Transmission and Distribution asset group, the 12

residual value of assets has been decreasing while at the same time labor and 13

disposal costs having been increasing. The effect on the calculation of net salvage 14

is then two fold. There is a downward trend on gross salvage and an upward 15

trend on the cost of removal that has been occurring for many years. When net 16

salvage becomes increasingly negative, depreciation expense increases over 17

previous levels. To remedy the shortfall caused by the current depreciation rates, 18

the Commission should approve the net salvage parameters proposed in the 19

Depreciation Study to provide SPS straight-line asset recovery and prevent 20

intergenerational inequities. 21

# Wa ts on Direct – Revenue Requirement Page 35



# E. Vintage Year Depreciation of General Plant Assets, FERC 1



# Accounts 391-398 2

Q. Please describe the Vintage Group methodology. 3

A. For general plant assets in accounts 391-398, SPS is requesting to continue to use 4

a vintage year accounting method approved by the FERC in Accounting Release 5

Number 15 (“AR-15”), Vintage Year Accounting For General Plant Accounts

, 6

dated January 1, 1997. AR-15 allowed utilities to use a simplified method of 7

accounting for general plant assets, excluding structures and improvements 8

(referred to as “general plant”). The AR-15 release allowed high-volume, 9

low-cost assets to be amortized over the associated useful life, eliminated the need 10

to track individual assets, and allows a retirement to be booked at the end of the 11

depreciable life. This method is often referred to as “amortization of general 12

plant.” 13

Adopting the method of accounting allowed in AR-15 changes the level of 14

detail maintained in the asset records and performs the depreciation calculation at 15

a vintage level rather than at a total account level. The plant asset balances will 16

be maintained by vintage installed with the retirement being recorded when book 17

depreciation has been completed. The empirical retirement data for actuarial or 18

semi-actuarial analysis will no longer be reliable, however, the determination of 19

useful life can be made appropriately with the use of market forces, manufacturer 20

expected life, technological obsolescence, business planning, known causes of 21

retirement, and changes in expected future utilization. 22

The depreciation calculation uses a useful life applied to a vintage versus 23

the entire account. The depreciation recovery is complete when the vintage 24

# Wa ts on Direct – Revenue Requirement Page 36 

# accumulated depreciation is equal to the vintage plant adjusted for estimated 1

s a lvage and removal costs. 2

Q. Please describe the methodology or technique employed in analyzing the life 3

of Vintage Group Property. 4

A. Similar to the Transmission, Distribution, and General plant structure and 5

improvement assets described above, vintage group property for these accounts 6

was analyzed using actuarial analysis. Life parameters for other accounts in this 7

group were derived from the stipulation agreement in Docket No. 35763. By 8

evaluating the retirement forces and the impact on the current in-service property, 9

an appropriate recovery period was determined. 10

Q. Has the Commission approved Vintage Group amortization for other 11

companies in Texas? 12

A. Yes. In the most recently fully litigated cases regarding depreciation, the 13

Commission approved vintage group amortization for Oncor Electric Delivery 14

Company, LLC (Docket No. 35717 13 

# ), CenterPoint Energy Houston Electric LLC 15

( Docket No. 38339 14 

# ), and Entergy (Docket No. 39896). 16

Q . Please describe the results of the Vintage Group Depreciation Study. 17

A. The vintage group depreciation analysis recommends slight adjustments to 18

depreciation parameters for this group. SPS requests only a change to the service 19

life of one account, FERC Account 393 Stores Equipment. The study also 20

recommends a change to the net salvage percentages for five general plant 21

13 

# Application of Oncor Electric Delivery Company, LLC for Authority to Change Rates, Doc ket

No. 35717 (Aug. 31, 2009).

# Wa ts on Direct – Revenue Requirement Page 37 

# accounts: FERC Account 391 Office Furniture and Equipment, Ac c ount 392 1

Transportation Equipment, Account 394 Tools, Shop and Garage Equipment, 2

Account 396 Power Operated Equipment, and Account 397 Communication 3

Equipment. SPS’s present depreciation rates were compared to the Depreciation 4

Study recommendations in Appendix B of Attachment DAW-RR-2. The rates 5

proposed for Vintage Group property are an increase of $6.1 million, or 6

approximately 3.7 percent increase in annual depreciation rates, from SPS’s 7

present depreciation rates. It should be noted that $5.0 million of this increase is 8

attributable to the reserve position and necessary recovery, which is shown on 9

Appendix A-2. Ms. Perkett will discuss the effect of SPS’s proposed depreciation 10

rates on SPS’s test-year depreciation expense. 11

14 

# Application of Centerpoint Energy Houston Electric, LLC for Authority to Change Rates,

Doc ket No. 38339 (May 12, 2011).

# Wa ts on Direct – Revenue Requirement Page 38 

# V. CONCLUSION 1

Q. Were Exhibits DAW-RR-1 through DAW-RR-3 prepared by you or under 2

your direct supervision and control? 3

A. Yes. 4

Q. Does this conclude your pre-filed direct testimony? 5

A. Yes. 6

# SOUTHWESTERN PUBLIC SERVICE COMPANY

LIST O F APPEARANCES BEFORE REGULATORY BODIES BY

DANE A. WATSON

Line

No. 

# Asse t Location Commission Docket (If

Applicable) Company Year Description

1 

# New Jersey Board o f

Public Utilities GR13111137 South Jersey

Gas 2013 Gas Depreciation

Study

2 

# Various FERC RP14-247-000 Sea Robin 2013 Gas De preciation

Study

3 

# Arkansas Arkansa s

Public Service

Commission 13-0 7 8-U Arkansas

Oklahoma

Gas 2013 Gas Depreciation

Study

4 

# Arkansas Arkansa s

Public Service

Commission 13-0 7 9-U Source Gas

Arkansas 2013 Gas Depreciation

Study

5 

# California Californ ia

Public Utilities

Commission Sout h ern

California

Edison 2013 Electric

Depreciation

Study

6 North

Ca rolina/South

Carolina 

# FERC ER13-1313 Progress

Energy

Carolina 2013 Electric

Depreciation

Study

7 

# Wisconsin Public Service

Commission

of Wi s consin 4220-DU-108 Northern

States PowerWisconsin 2013 Electric, Gas and

Common

Transmission,

Distribution and

General

8 

# Texas Publi c Utility

Commission

of Texas 41474 Sharyland 2013 Electric

Depreciation

Study

9 

# Kentucky Kentuc ky

Public Service

Commission 2013

- 00148 Atmos Energy

Corporation 2013 G a s Depreciation

Study

10 Minnesot a 

# Minnesota

Public Utilities

Commission 13-2 5 2 Minnesota

Power 2013 Electric

Depreciation

Study

11 

# New Hampshire New

Ham pshire

Public Service

Commission DE 1 3 -063 Liberty

Utilities 2013 Electric

Distribution and

General

12 

# Texas Railroa d

Commission

of Texas 10235 West Texas

Gas 2013 Gas Depreciation

Study

13 

# North Dakota North D akota

Public Service

Commission PU-12 -0813 Northern

States Power 2012 Electric, Gas and

Common

Transmission,

Distribution and

General

# SOUTHWESTERN PUBLIC SERVICE COMPANY

LIST O F APPEARANCES BEFORE REGULATORY BODIES BY

DANE A. WATSON

Line

No. 

# Asse t Location Commission Docket (If

Applicable) Company Year Description

14 Alas k a 

# Regulatory

Commis sion

of Alaska U-12-154 Alaska

Telephone

Company 2012 Telecommunicatio

ns Utility

15 New Mexi co 

# New Mexico

Public

Regulation

Commission 12-00350-UT SPS 2012 Electric

Depreciation

Study

16 Colora do 

# Colorado

Public Utilities

Commission 12AL

- 1269ST Public Service

of Colorado 2012 G a s and Steam

Depreciation

Study

17 Colora do 

# Colorado

Public Utilities

Commission 12AL

- 1268G Public Service

of Colorado 2012 G a s and Steam

Depreciation

Study

18 Alaska 

# Re gulatory

Commis sion

of Alaska U-12-149 Municipal

Power and

Light City of

Anchorage 2012 Electric

Depreciation

Study

19 Texas 

# Te x as Public

Utili t y

Commission 40824 Xcel Energy 2012 Electric

Depreciation

Study

20 South Ca r olina 

# Public Service

Commission

of So u th

Carolina Docket 2012-384-

E Progress

Energy

Carolina 2012 Electric

Depreciation

Study

21 Alaska 

# Re gulatory

Commis sion

of Alaska U-12-141 Interior

Telephone

Company 2012 Telecommunicatio

ns Utility

22 Michiga n 

# Michigan

Public Service

Commission U-17 1 04 Michigan Gas

Utilities

Corpora t ion 2012 Gas Depreciation

Study

23 North Ca rolina 

# North Carolina

Utilities

Commi s sion E-2 Sub 1025 Progress

Energy

Carolina 2012 Electric

Depreciation

Study

24 Texas 

# Wes t Texas

Gas 2012 G as Depreciation

Study

25 Texas 

# Te x as Public

Utili t y

Commission 40606 Wind Energy

Transmission

Texas 2012 Electric

Depreciation

Study

26 Texas 

# Te x as Public

Utilit y

Commission 40604 Crosss Texas

Transmission 2012 Electric

Depreciation

Study

# SOUTHWESTERN PUBLIC SERVICE COMPANY

LIST O F APPEARANCES BEFORE REGULATORY BODIES BY

DANE A. WATSON

Line

No. 

# Asse t Location Commission Docket (If

Applicable) Company Year Description

27 

# Minn e sota Minnes ota

Public Utilities

Commission 12-8 5 8 Northern

States Power 2012 Electric, Gas and

Common

Transmission,

Distribution and

General

28 

# Texas Railroa d

Commission

of Texas 10170 Atmos MidTex 2012 Gas Depreciation

Study

29 

# Texas Railroa d

Commission

of Texas 10174 Atmos West

Texas 2012 Gas Depreciation

Study

30 

# Texas Railroa d

Commission

of Texas 10182 CenterPoint

Beaumont/

East Texas 2012 Gas Depreciation

Study

31 

# Kansas Kansas

Corporation

Commission 12-KCPE-764-

RTS Kansas City

Power and

Light 2012 Electric

Depreciation

Study

32 

# Nevada Public Utility

Commission

of Nevada 12-04005 Southwest

Gas 2012 Gas Depreciation

Study

33 

# Texas Railro a d

Commission

of Texas 10147, 10170 Atmos MidTex 2012 Gas Depreciation

Study

34 

# Kansas Kansas

Corporation

Commission 12-ATMG-564-

RTS Atmos Kansas 2012 Gas Depreciation

Study

35 Texas 

# Tex as Public

Utilit y

Commission 40020 Lone Star

Transmission 2012 Electric

Depreciation

Study

36 Michiga n 

# Michigan

Public Service

Commission U-16 9 38 Consumers

Energy

Company 2011 Gas Depreciation

Study

37 Colora do 

# Public Utilities

Commission

of Col o rado 11AL-947E Public Service

of Colorado 2011 E l ectric

Depreciation

Study

38 Texas 

# Tex as Public

Utilit y

Commission 39896 Entergy Texas 2011 Electric

Depreciation

Study

39 MultiS t ate 

# FERC ER12-212 America n

Transmission

Company 2011 Electric

Depreciation

Study

# SOUTHWESTERN PUBLIC SERVICE COMPANY

LIST O F APPEARANCES BEFORE REGULATORY BODIES BY

DANE A. WATSON

Line

No. 

# Asse t Location Commission Docket (If

Applicable) Company Year Description

40 Cali f

ornia 

# California

Public Utilities

Commission A101 1 015 Southern

California

Edison 2011 Electric

Depreciation

Study

41 MultiSt ate 

# Atmos Energy 2011 Shared Services

Depreciation

Study

42 Missis sippi 

# Mississippi

Public Service

Commission 2011

- UN-184 Atmos Energy 2011 Gas Depreciation

Study

43 Texas 

# Tex as

Commis sion

on

Environmental

Quality Matt e r 37050-R Southwest

Water

Company 2011 WasteWater

Depreciation

Study

44 Texas 

# Tex as

Commis sion

on

Environmental

Quality Matt e r 37049-R Southwest

Water

Company 2011 Water

Depreciation

Study

45 MultiS t ate 

# CenterPoint 2011 Shared Services

Study

46 MultiSt ate 

# CenterPoint 2011 Depreci ation

Reserve Study

(SAP)

47 Pennsylv ania 

# NA NA Safe Harbor 2011 Hydro

De preciation

Study

48 Michiga n 

# Michigan

Public Service

Commission U-16 5 36 Consumers

Energy

Company 2011 Wind Depreciation

Rate Study

49 Texas 

# Pu b lic Utility

Commis sion

of Texas 38929 Oncor 2011 Electric

Depreciation

Study

50 Texas 

# Rail road

Commis sion

of Texas 10038 CenterPoint

South TX 2010 Gas Depreciation

Study

51 Multis t ate 

# NA NA Const e llation

Energy 2010 Fossil Generation

Depreciation

Study

# SOUTHWESTERN PUBLIC SERVICE COMPANY

LIST O F APPEARANCES BEFORE REGULATORY BODIES BY

DANE A. WATSON

Line

No. 

# Asse t Location Commission Docket (If

Applicable) Company Year Description

52 Multi s tate 

# NA NA Conste llation

Energy

Nuclear 2010 Nuclear

Generation

Depreciation

Study

53 Alaska 

# Re gulatory

Commis sion

of Alaska U-10-070 Inside Passage

Electric

Coope ra tive 2010 Electric

Depreciation

Study

54 Texas 

# Pub lic Utility

Commis sion

of Texas 36633 City Public

Service of San

Antonio 2010 E l ectric

Depreciation

Study

55 Texas 

# Texas Railroad

Commission 1000 0 A tmos

Pipeline

Texas 2010 Gas Depreciation

Study

56 Multi St ate – SE US 

# FERC RP10-21-000 Florida Gas

Transmission 2010 Gas Depreciation

Study

57 Maine/ N ew

Hampshire 

# FERC 10-896 Granite State

Gas

Transmission 2010 Gas Depreciation

Study

58 Texas 

# P u blic Utility

Commis sion

of Texas 38480 Texas New

Mexico Power 2010 Electric

Depreciation

Study

59 Texas 

# Pu blic Utility

Commis sion

of Texas 38339 CenterPoint

Electric 2010 Electric

Depreciation

Study

60 Califo rnia 

# California

Public Utility

Commission A10071007 California

American

Water 2009-

2010 Water and Waste

Water

Depreciation

Study

61 Texas 

# Texas Railroad

Commission 1004 1 A tmos

Amarillo 2010 Gas Depreciation

Study

62 Georgi a 

# Georgia Public

Service

Commi s sion 31647 Atlanta Gas

Light 2010 Gas Depreciation

Study

63 Texas 

# Pu blic Utility

Commis sion

of Texas 38147 Southwestern

Public Service 2010 Electric Technical

Update

64 Alask a 

# Re gulatory

Commis sion

of Alaska U-09-015 Alaska

Electric Light

and Power 2009-

2010 Electric

Depreciation

Study

# SOUTHWESTERN PUBLIC SERVICE COMPANY

LIST O F APPEARANCES BEFORE REGULATORY BODIES BY

DANE A. WATSON

Line

No. 

# Asse t Location Commission Docket (If

Applicable) Company Year Description

65 Michi g an 

# Michigan

Public Service

Commission In P ro gress Edison Sault 2009 Electric

Depreciation

Study

66 Alaska 

# Re gulatory

Commis sion

of Alaska U-10-043 Utility

Services of

Alaska 2009-

2010 Water

Depreciation

Study

67 Tennesse e 

# Tennessee

Regula tory

Authority 09-000183 AGL –

Chattanooga

Gas 2009 Gas Depreciation

Study

68 Michiga n 

# Michigan

Public Service

Commission U-16 0 55 Consumers

Energy/DTE

Energy 2009-

2010 Ludington Pumped

Storage

Depre c iation

Study

69 Michiga n 

# Michigan

Public Service

Commission U-16 0 54 Consumers

Energy 2009-

2010 Electric

Depreciation

Study

70 Michiga n 

# Michigan

Public Service

Commission U-15 9 63 Michigan Gas

Utilities

Corpora t ion 2009 Gas Depreciation

Study

71 New Yo r k 

# New York

Public Service

Commission Key S pan 2009 Generation

Depreciation

Study

72 Michiga n 

# Michigan

Public Service

Commission U-15 9 89 Upper

Peninsula

Power

Company 2009 Electric

Depreciation

Study

73 Texas 

# Rail road

Commis sion

of Texas 9869 Atmos Energy 2009 Shared Services

Depreciation

Study

74 Missis sippi 

# Mississippi

Public Service

Commission 09-U N -334 CenterPoint

Energy

Mississippi 2009 Gas Depreciation

Study

75 Texas 

# Rail road

Commis sion

of Texas 9902 CenterPoint

Energy

Houston 2009 Gas Depreciation

Study

76 Iowa 

# NA Ced ar F alls

Utility 2009 Telecommunicatio

ns, Water, and

Cable Utility

77 Wyomi ng 

# W yoming

Public Service

Commission 30022 -148-GR10 Source Gas 2009-

2010 Gas Depreciation

Study

# SOUTHWESTERN PUBLIC SERVICE COMPANY

LIST O F APPEARANCES BEFORE REGULATORY BODIES BY

DANE A. WATSON

Line

No. 

# Asse t Location Commission Docket (If

Applicable) Company Year Description

78 Colo r ado 

# Colorado

Public Utilities

Commission 09AL

- 299E Public Service

of Colorado 2009 E l ectric

Depreciation

Study

79 Tennesse e 

# Tennessee

Regula tory

Authority 11-00144 Piedmont

Natural Gas 2009 Gas Depreciation

Study

80 South Car olina 

# Public Service

Commission

of So u th

Carolina Piedmont

Natural Gas 2009 Gas Depreciation

Study

81 North Ca rolina 

# North Carolina

Utilities

Commi s sion Piedmont

Natural Gas 2009 Gas Depreciation

Study

82 Louisia na 

# Louisiana

Public Service

Commission U-30 6 89 Cleco 2008 Electric

Depreciation

Study

83 Texas 

# Pu b lic Utility

Commis sion

of Texas 35763 SPS 2008 Electric

Production,

Transmission,

Distribution and

General Plant

Depreciation

Study

84 Wiscons in 

# Wisconsin 05-DU-101 WE Energies 2008 Electri c, Gas,

Steam and

Common

Depreciation

Studies

85 Arizona 

# N A NA Arizona

Public Service 2008 Fixed Asset

Consulting

86 Multiple States 

# NA NA Conste llation

Energy 2008 Generation

Depreciation

Study

87 North Da kota 

# North Dakota

Public Service

Commission PU-0 7 -776 Northern

States Power 2008 Net Salvage

88 New Me xi co 

# New Mexico

Public

Regulation

Commission 07-00319-UT SPS 2008 Testimony –

Depreciation

# SOUTHWESTERN PUBLIC SERVICE COMPANY

LIST O F APPEARANCES BEFORE REGULATORY BODIES BY

DANE A. WATSON

Line

No. 

# Asse t Location Commission Docket (If

Applicable) Company Year Description

89 Multi pl e States 

# Railroad

Commis sion

of Texas 9762 Atmos Energy 2007-

2008 Shared Services

Depreciation

Study

90 Multiple States 

# None Tennes see

Valley

Authority 2007-

2008 Electric

Generation and

Transmission

Depreciation

Study

91 Colora do 

# Colorado

Public Utilities

Commission File d – no docket

to date Public Service

of Colorado 2007

-

2 008 Electric

Depreciation

Study

92 Colora do 

# Colorado

Public Utilities

Commission 10AL

- 963G Public Service

of Colorado 2007

-

2 008 Gas Depreciation

Study

93 Minnesot a 

# Minnesota

Public Utilities

Commission E015 / D-08-422 Minnesota

Power 2007-

2008 Electric

Depreciation

Study

94 Texas 

# Pu b lic Utility

Commi s sion

of Texas 35717 Oncor 2008 Electric

Depreciation

Study

95 Multipl e States 

# NA NA Conste llation

Energy 2007 Generation

Depreciation

Study

96 Texas 

# Pub lic Utility

Commis sion

of Texas 34040 Oncor 2007 Electric

Depreciation

Study

97 Michiga n 

# Michigan

Public Service

Commission U-15 6 29 Consumers

Energy 2006-

2009 Gas Depreciation

Study

98 Colora do 

# Colorado

Public Utilities

Commission 06-2 3 4-EG Public Service

of Colorado 2006 E l ectric

Depreciation

Study

99 Multiple States 

# Multiple NA CenterP oint

Energy 2006 Shared Services

Depreciation

Study

100 Arkans a s 

# Arkansas

Public Service

Commission 06-16 1-U CenterPoint

Energy –

Arkla Gas 2006 Gas Distribution

Depreciation

Study and

Removal Cost

Study

# SOUTHWESTERN PUBLIC SERVICE COMPANY

LIST O F APPEARANCES BEFORE REGULATORY BODIES BY

DANE A. WATSON

Line

No. 

# Asse t Location Commission Docket (If

Applicable) Company Year Description

101 Neva da 

# N A NA Nevada

Power/Sierra

Pacific 2006 ARO Consulting

102 Pennsylv ania 

# NA NA Safe Harbor 2006 Hydro

De preciation

Study

103 Utah, Nev ada,

California 

# NA NA Intermountain

Power

Auth o rity 2006 Generation

Depreciation

Study

104 Texas, Ne w Mexico 

# Public Utility

Commis sion

of Texas 32766 Xcel Energy 2005-

2006 Electric

Production,

Transmission,

Distribution and

General Plant

Depreciation

Study

105 Texas 

# Rail road

Commis sion

of Texas 9670/9676 Atmos Energy

Corp 2005

-

2 006 Gas Distribution

Depreciation

Study

106 Texas 

# Rai l road

Commis sion

of Texas 9400 TXU Gas 2003-

2004 Gas Distribution

Depreciation

Study

107 Texas 

# Rail road

Commis sion

of Texas 9313 TXU Gas 2002 Gas Distribution

Depreciation

Study

108 Texas 

# Rail road

Commis sion

of Texas 9225 TXU Gas 2002 Gas Distribution

Depreciation

Study

109 Texas 

# Pub lic Utility

Commis sion

of Texas 24060 TXU 2001 Line Losses

110 Texas 

# Pub lic Utility

Commis sion

of Texas 23640 TXU 2001 Line Losses

111 Texas 

# Rail road

Commis sion

of Texas 9145-9148 TXU Gas 2000-

2001 Gas Distribution

Depreciation

Study

112 Texas 

# Pu b lic Utility

Commi s sion

of Texas 22350 TXU 2000-

2001 Electric

Depreciation

Study, Unbundling

# SOUTHWESTERN PUBLIC SERVICE COMPANY

LIST O F APPEARANCES BEFORE REGULATORY BODIES BY

DANE A. WATSON

Line

No. 

# Asse t Location Commission Docket (If

Applicable) Company Year Description

113 Texas 

# Ra i lroad

Commis sion

of Texas 8976 TXU Pipeline 1999 Pipeline

Depreciation

Study

114 Texas 

# Pub lic Utility

Commis sion

of Texas 20285 TXU 1999 Fuel Company

Depreciation

Study

115 Texas 

# Pub lic Utility

Commis sion

of Texas 18490 TXU 1998 Transition to

Competition

116 Texas 

# Pub lic Utility

Commis sion

of Texas 16650 TXU 1997 Customer

Complaint

117 Texas 

# Pub lic Utility

Commis sion

of Texas 15195 TXU 1996 Mining Company

Depreciaiton

Study

118 Texas 

# Pub lic Utility

Commis sion

of Texas 12160 TXU 1993 Fuel Company

Depreciation

Study

119 Texas 

# Pu b lic Utility

Commi s sion

of Texas 11735 TXU 1993 Electric

Depreciation

Study

# SOUTHWESTERN PUBLIC SERVICE

COMPANY- TEXAS

Book Depreciation Accrual Rate

Study

At June 30, 2013

# 2 SOUTHWESTERN PUBLIC SERVICE COMPANY-TEXAS

DEPRECIATION RATE STUDY

AT JUNE 30, 2013

Table of Contents

PURPOSE ....................................................................................................... 4

STUDY RESU LTS .......................................................................................... 5

GENERAL DIS CUSSION ............................................................................... 6

Definiti on .................................................................................................... 6

Basis of Depreciat ion Estima tes .............................................................. 6

Survivor Curves ......................................................................................... 7

Life Span Pr ocedur e ................................................................................ 10

Interim Retireme nt Cur ves ...................................................................... 10

Actuarial An alysis ................................................................................... 11

Simulated Plant Reco rd Proce dure ........................................................ 12

Judgmen t ................................................................................................. 15

Theoretical Depreci ation R eserve .......................................................... 16

DETAILED DIS CUSSION ............................................................................. 17

Depreciation St udy Pro cess ................................................................... 17

Production Depreciation Ca lculation Pr ocess ...................................... 20

Transmission, Distribution and General Calculat ion Process ............ 21

Vintage Group Am ortizati on ................................................................... 22

LIFE ANAL YSIS ........................................................................................... 24

Steam Production, FE RC Accounts 311-316 ......................................... 24

Other Production, FE RC Accounts 340-346 .......................................... 32

Transmission Accounts, FERC Account s 350-358 ............................... 33

Distribution Accounts, FERC Account s 360-373 .................................. 42

SALVAGE ANAL YSIS .................................................................................. 62

Salvage - Steam Production and Other Production Property .............. 63

Salvage - Transmi ssion Prope rty ........................................................... 64

# 3 Salvage – Distribution Prope rty ............................................................. 67

Salvage – Genera l Propert y .................................................................... 71

APPENDIX A Computation of De preciation Accr ual Rates ..................... 75

APPENDIX B Comparison of Approved vs Proposed Accrual Rates ..... 83

APPENDIX C Comparison of De preciation Para meters ........................... 86

APPENDIX D Retirement Data for all Genera ting Units ........................... 99

APPENDIX E Net Salvage Anal ysis by A ccount ..................................... 101

# 4 PURPOSE

The purpose of this study is to devel op functional depreciation rates for the

depreciable production, transmission, di stribution, and general property as

recorded on the books of Southwestern Public Service Company (SPS or

Company) as of June 30, 2013. The depreciation rates were designed to

recover the total remaining undepreciated investment, adjusted for net salvage,

over the remaining life of SPS’s property on a straight-line basis. Nondepreciable property and property that is amor tized, such as intangible software,

were excluded from this study. SPS is engaged in the generation, transmission,

and distribution of electricity within Texas and New Mexico. Company-wide

(Texas and New Mexico), SPS provides electricity to more than 380,000

wholesale and retail customers.

Assets for SPS at January 1, 2013 incl ude: 4,306 megawatts of generation;

6,805 conductor miles of 345 kV transmi ssion lines with supporting structures;

9,684 conductor miles of 230 kV transmi ssion lines with supporting structures;

11,479 conductor miles of 115 kV transmi ssion line with supporting structures;

22,067 conductor miles of less than 115 kV line and 426 transmission and

distribution substations. In addition, SPS needs associated equipment such as

feeders, primary switches, poles, conductor, line transformers, services, meters,

and streetlights to serv e its 380,000 customers.

General property such as buildings , office furniture, transportation

equipment, and other miscellaneous proper ty is located throughout the

Company’s service territory.

# 5 STUDY RESULTS

Recommended depreciation rates for all SPS depreciable property are shown

in Appendix A. These rates translate into an annual depreciation accrual (total

company) for Generation of $51.4 million and for Transmission, Distribution (Texas

Only) and General plant of $69.9 million. These accruals are based on SPS's

depreciable investment as of June 30, 2013 (test year) as shown in Appendix B.

The annual depreciation expense calculated by the same method using the existing

approved Texas depreciation rates was $28.4 million for Generation and $62.0

million for Transmission, Distr ibution, and General plant. Appendix B shows the

effect of the change in lives and curves on depreciation accrual by account. The

proposed lives and curves on wh ich these calculations are based are shown in

Appendix C. Appendix D shows the Production unit retirement dates. Appendix E

addresses the development of net salvage parameters for all plant accounts.

This study also recommends that SPS continue its depreciation process for

general plant (excluding Accounts 389 and 390) of a general plant amortization

process. Since Docket No. 35763, t he Company has been using general plant

amortization. In compliance with the U nanimous Stipulation in Commission Docket

No. 35763, the Company is presenting updated estimates of life and net salvage for

general plant. In this proceeding, the Com pany requests that the depreciation study

parameters (life and net salvage) for general plant be approved.

# 6 GENERAL DISCUSSION

Definition

The term "depreciation" as used in this study is considered in the accounting

sense; that is, a system of accounting that distributes the cost of assets, less net

salvage (if any), over the es timated useful life of the assets in a systematic and

rational manner. It is a process of alloca tion, not valuation. This expense is

systematically allocated to accounting peri ods over the life of the properties. The

amount allocated to any one accounting per iod does not necessar ily represent the

loss or decrease in value t hat will occur during that particular period. The Company

accrues depreciation on the basis of the or iginal cost of all depreciable property

included in each functional property group. At retirement, the full cost of depreciable

property, less the net salvage value, is charged to the depreciation reserve.

Basis of Depreciation Estimates

Annual and accrued depreciation were calculat ed in this study by the straightline, broad group, remaining-life depreciati on system. In this system, the annual

depreciation expense for each group is computed by dividing the original cost of the

asset group less allocated depreciation rese rve less estimated net salvage by its

respective average remaining life. The resulting annual accrual amounts of all

depreciable property within a function were accumulated and the total was divided

by the original cost of all functi onal depreciable property to determine the

depreciation rate. The calculated rema ining lives and annual depreciation accrual

rates were based on attained ages of plant in service and the estimated service life

and salvage characteristics of each deprec iable group, and were computed in a

direct weighting by multiplying each vint age or account balance times its remaining

life and dividing by the plant investment in service as of June 30, 2013. The

computations of the annual functional depr eciation rates are shown in Appendix A,

and the weighted remaining life calculat ions are also shown in Appendix A.

A variety of life estimation approaches were incorporated into analyses of

SPS data. Both Simulated Plant Record (SPR) analysis and Actuarial Analysis are

commonly used mortality analysis techniques fo r electric utility property. Historically,

SPS has used SPR analysis to evaluate lives of most asset groups. Where vintaged

# 7 information is available, actuarial analysis was performed. Transmission,

Distribution substation, and General property accounts were analyzed in this study

using actuarial analysis. Mass Distri bution accounts (account 364 – 373) were

analyzed using SPR analysis. For the a ccounts using actuarial analysis, (i.e.

Accounts 350-362 and 389-398) experience bands varied depending on the amount

of data. The 1968-2012 experience band was the maximum used for accounts 352-

362 and general accounts 390-398. Judgment was used to a greater or lesser

degree on all accounts. Each approach used in this study is more fully described in

a later section.

Survivor Curves

To fully understand depreciation projections in a regulated utili ty setting, there

must be a basic understanding of survivor cu rves. Individual assets within a group

do not normally have identical lives or in vestment amounts. The average life of a

group can be determined by com paring actual experience against various survivor

curves. A survivor curve represents the percentage of property remaining in service

at various age intervals. The most widely used set of representative survivor curves

are the Iowa Survivor Curves (Iowa Curves). The Iowa Curves are the result of an

extensive investigation of life characteristics of physical pr operty made at Iowa State

College Engineering Experiment St ation in the first half of the twentieth century.

Through common usage, revalidation, and r egulatory acceptance, these curves

have become a descriptive standar d for the life characteristics of industrial property.

An example of an Iowa Curve is shown below.

# 8 There are four families in the Iowa Curves which are distinguished by the

relation of the age at the retirement m ode (largest annual retire ment frequency) and

the average life. The four families are designated as “R”— Right, “S” — Symmetric,

“L” — Left, and “O” — Origin Modal. Firs t, for distributions with the mode age

greater than the average life, an "R" designation (i.e., Ri ght modal) is used. The

family of “R” moded curves is shown below.

# 9 Second, an "S" designation (i.e., Symmetr ic modal) is used for the family

whose mode age is symmetric about the average life. Third, an "L" designation (i.e.,

Left modal) is used for the family whos e mode age is less than the average life.

Fourth, a special case of left modal dis persion is the "O" or origin modal curve

family. Within each curve family, numeric al designations are used to describe the

relative magnitude of the retirement frequenc ies at the mode. A "6" indicates that

the retirements are not greatly dispersed from the mode (i.e., hi gh mode frequency)

while a "1" indicates a large dispersi on about the mode (i.e., low mode frequency).

For example, a curve with an average life of 30 years and an "L3" dispersion is a

moderately dispersed, left modal curve t hat can be designated as a 30 L3 Curve.

An SQ, or square, survivor curve occurs where no dispersion is present (i.e., units of

common age retire simultaneously).

# 10 For Production interim retirement curv es, and Transmission, Distribution, and

General Property accounts, a survivor curve pattern was selected based on

analyses of historical data, as well as other factors, such as general changes

relevant to the Company's operations. The blending of judgment concerning current

conditions and future trends, along with the ma tching of historical data permits the

depreciation analyst to make an informed se lection of an account's average life and

retirement dispersion pattern. Iowa Cu rves were used to depict the estimated

survivor curves for each account.

Life Span Procedure

The life span procedure was used for production facilities for which most

components are expected to have a retire ment date concurr ent with the planned

retirement date of the generating unit. The terminal retirement date refers to the

year that each unit will ceas e operations. The terminal retirement date, along with

the interim retirement characteristics of the assets that will retire prior to the facility

ceasing operation; describe the pattern of re tirement of the assets that comprise a

generating unit. The estimated terminal retirement dates fo r the various generating

units were determined based on consulta tion with SPS management, financial, and

engineering staff. Those estimated terminal retirement dates are shown in Appendix

D.

Interim Retirement Curves

Interim retirement curves were used to model the retirement of individual

assets within primary plant acc ounts for each steam generating unit prior to the

terminal retirement of the facility. (No interim retirement curve was used with other

production assets.) The life span procedur e assumes all assets are depreciated

(straight-line) for the same number of per iods and retire at the same time (the

terminal retirement date). Adding interim re tirement curves to the procedure reflects

the fact that some of the assets at a pow er plant will not survive to the end of the life

of the facility and should be depreciated (s traight-line) more quickly and retired

earlier than the terminal life of t he facility. The goal of interi m retirement curves is to

project how many of the assets that are cu rrently in service will retire each year in

the future using historical analysis and judgm ent. These curves were chosen based

# 11 primarily on an analysis of the historical retirement pattern of the generation assets

and consultation with SPS personnel. Interi m retirements for each plant account

were modeled using Iowa Curves discussed above. By applying in terim retirements,

recognition is given to the obvious fact that generating units will have retirements of

depreciable property before the end of their lives.

Although interim retirements have been recognized in the study, interim

additions (i.e. future additions) have been ex cluded from the study. The estimated

amount of future additions might or might not occur. However, there is no

uncertainty as to whether the full level of interim retirements will happen. The

assets that are being modeled for retirement are already in rate base. Depreciation

rates using interim retirements are know n and measurable in the same way that

setting depreciation rates for transmission or di stribution property using Iowa Curves

is known and measurable. There is no depr eciable asset that is expected to live

forever. All assets at a power plant will re tire at some point. Interim retirements

simply model when those retirements will o ccur in the same way that is done for

transmission or distribution assets. Consis tent with the deprecia tion rates submitted

by the Company in Commission Docket No. 35763, we believe it is appropriate to

include interim retirements in the developm ent of depreciation rates for production

plant and this study has incorporated an interim retirement component for

production plant Accounts 311-316.

Actuarial Analysis

Actuarial analysis (retirement rate met hod) was used in evaluating historical

asset retirement experience where vi ntage data were available and sufficient

retirement activity was present. In act uarial analysis, interval exposures (total

property subject to retirement at the beginning of the age interval, regardless of

vintage) and age interval retirements are calcul ated. The complement of the ratio of

interval retirements to interval exposures es tablishes a survivor ratio. The survivor

ratio is the fraction of property surviving to the end of the selected age interval, given

that it has survived to the begi nning of that age interval. Surv ivor ratios for all of the

available age intervals were chained by su ccessive multiplications to establish a

series of survivor factors, collectivel y known as an observ ed life table. The

# 12 observed life table shows the experienced mort ality characteristic of the account and

may be compared to standard mortality curves such as the Iowa Curves. Many

accounts were analyzed using this method. Placement bands were used to illustrate

the composite history over a specific era, and experience bands were used to focus

on retirement history for all vintages during a set period. Matching data in observed

life tables for each experience and placement band to an Iowa Curve requires visual

examination. As stated in Depreciation Systems by Wolf and Fitch, “the analyst

must decide which points or sections of t he curve should be given the most weight.

Points at the end of the curve are o ften based on fewer exposures and may be

given less weight than thos e points based on larger samples” (page 46). Some

analysts chose to use mathematical fitting as a tool to narrow the population of

curves using a least squares technique. Use of the least squares approach does

not imply a statistical validity, however , because the underlying data does not meet

criteria for independence between vintages and t he same average price for property

units through time. Thus, Depreciation Systems cautions, “... the results of

mathematical fitting should be checked visua lly and the final determination of best fit

made by the analyst” (page 48). This study us es the visual matching approach to

match Iowa Curves, since mathematical fi tting produces theoretically possible curve

matches. Visual examination and exper ienced judgment allow the depreciation

professional to make the final determi nation as to the best curve type.

Detailed information for each account is shown later in this study and in

workpapers.

Simulated Plant Record Procedure

The SPR - Balances approach is one of the commonly accepted approaches

to analyze mortality characteristics of ut ility property. SPR was applied to several

accounts within the Distribut ion function due to the unavailability of vintaged

transactional data. In this method, an Iowa Curve and average service life are

selected as a starting point of the analysis and its survivor factors applied to the

actual annual additions to give a sequenc e of annual balance totals. These

simulated balances are compared with the ac tual balances by using both graphical

and statistical analysis. Thr ough multiple comparisons, t he mortality characteristics

# 13 (as defined by an average life and Iowa Curv e) that are the best match to the

property in the account can be found.

The Conformance Index (CI) is one m easure used to evaluate various SPR

analyses. CIs are also used to evaluate the "goodness of fit" between the actual

data and the Iowa Curve being referenced. The sum of squares difference (SSD) is

a summation of the difference between t he calculated balances and the actual

balances for the band or study year being analyzed. This difference is squared and

then summed to arrive at the SSD.

Where n is the number of years in the test band.

This calculation can then be used to devel op other calculations, which the analyst

feels might give a better indication for t he “goodness of fit” fo r the representative

curve under consideration. The residual measure (RM) is the square root of the

average squared differences as developed above. The residual measure is

calculated as follows:

The CI is developed from the residual measure and the average observed plant

balances for the band or study year being anal yzed. The calculat ion of conformance

index is shown below:

RM n / Balances =CI i n

1 

# 

The retirement experience i ndex (REI) gives an indication of the maturity of the

account and is the percent of the property re tired from the oldest vintage in the band

at the end of the study year . Retirement indices range from 0 percent to 100

percent and an REI of 100 percent indicates that a complete curve was used. A

retirement index less than 100 percent indicates that the survivor curve was

truncated at that point. T he originator of the SPR me thod, Alex Bauhan, suggests

ranges of value for the CI and REI. The relationship for CI proposed by Bauhan is 

# ) Balance Observed- Balance d(Calculate =SSD 2

i i n

1 

# 

)

n SSD (=RM

# 14 shown below 1 

# :

CI Value

Over 75 Excellent

50 to 75 Good

25 to 50 Fair

Under 25 Poor

The relationship for REI proposed by Bauhan 2 

# is shown below:

REI Value

Over 75 Excellent

50 to 75 Good

33 to 50 Fair

17 to 33 Poor

Under 17 Valueless

Despite the fact there has not been empi rical research to validate Bauhan’s

conclusions, depreciation analysts have used these measures in analyzing SPR

results for nearly 60 years, since the SPR method was developed.

1 Public Utility Depreciation Practices, p. 96.

2 Public Utility Depreciation Practices, p. 97.

# 15 Each of these statistics pr ovides the analyst with a different perspective of the

comparison between a band of simulated or calculated balances and the observed

or actual balances in the account being studied. Although one statistic is not

necessarily superior over the others, t he conformance index is the one many

analysts use in depreciation studies. T he depreciation analyst should carefully

weigh the data from REIs to ensure that a mature curve is being used to estimate

life.

Statistics are useful in anal yzing mortality characteristics of accounts as well

as determining a range of service lives to be analyzed using the detailed graphical

method. However, these stat istics boil all the information down to one, or at most,

a few numbers for comparison. Vis ual matching through comparison between

actual and calculated balances expands the analysis by permitting the analyst to

view many points of data at a time. The goodness of fit should be visually

compared to plots of other Iowa Curve dispersions and average lives for the

selection of the appropriate curve and life. Detailed information fo r each account is

shown later in this study and in workpapers.

Judgment

Any depreciation study requires in formed judgment by the analyst

conducting the study. A knowledge of the pr operty being studied, company policies

and procedures, general trends in technology and industry practice, and a sound

basis of understanding depreciation theor y are needed to apply this informed

judgment. In this depreciati on study, judgment was used in areas such as survivor

curve modeling and selection, depreciati on method selection, simulated plant

record method analysis, and actuarial analysis.

Where there are multip le factors, activities, action s, property characteristics,

statistical inconsistencies, property mi x in accounts or a multitude of other

considerations that affect the analysis (potent ially in various dire ctions), judgment is

used to take all of these considerations and synthesize t hem into a general

direction or understanding of t he characteristics of the property. Individually, no

one consideration in these cases may hav e a substantial impact on the analysis,

but overall, the collective e ffect of these considerations may shed light on the use

# 16 and characteristics of assets. Judgment may also be defined as deduction,

inference, wisdom, common sense, or the ab ility to make sensible decisions. There

is no single correct result from statistica l analysis; hence, there is no answer absent

judgment.

Theoretical Depreciation Reserve

The book accumulated provision fo r depreciation within each function was

allocated among generation, transmission, distribution, and general accounts

through the use of the theor etical depreciation reserve model. This study used a

reserve model that relied on a prospective concept relating future retirement and

accrual patterns for property, given current life and salvage estimates.

The theoretical reserve of a property group is developed from the estimated

remaining life of the group, the total life of the group, and estima ted net salvage.

The theoretical reserve represents the por tion of the group cost that would have

been accrued if current forecasts were us ed throughout the life of the group for

future depreciation accruals. The comput ation involves multiplying the vintage

balances within the group by t he theoretical reserve rati o for each vintage. The

straight-line remaining-life theoretical re serve ratio at any given age (RR) is

calculated as: 

# Ratio) SalvageNet-(1* Life) Service (Average Life) Remaining (Average -1=RR

# 17 DETAILED DISCUSSION

Depreciation Study Process

This depreciation study encompassed four distinct phases. The first phase

involved data collection and field interv iews. The second phase was where the

initial data analysis occurred. The th ird phase was where the information and

analysis was evaluated. After the first th ree stages were complete, the fourth

phase began. This phase involved the ca lculation of deprecation rates and

documenting the corresponding recommendations.

During the Phase I data collection proc ess, historical data was compiled

from continuing property records and general ledger systems. Data was validated

for accuracy by extracting and comparing to multiple financial system sources:

Projects System (Construction ledger), Fi xed Asset System (continuing property

ledger), General Ledger, and interfaces from other operating systems. Audit of this

data was validated against historical data from prior periods, historical general

ledger sources, and field personnel di scussions. This data was reviewed

extensively so that it coul d be put in the proper format for a depreciation study.

Further discussion on data review and adj ustment is found in the Salvage

Consideration section of this study. Al so as part of the P hase I data collection

process, numerous discussions were conducted with engineers and field operations

personnel to obtain information that would be helpful in formulating life and salvage

recommendations in this study. One of t he most important elem ents in performing

a proper depreciation study is to understand how the Company utilizes assets and

the environment of those assets. Understanding industry and geographical norms

for mortality characteristics are import ant factors in sele cting life and salvage

recommendations; however, care must be used not to apply them rigorously to any

particular company since no two companies would have the same exact forces of

retirement acting upon their assets. In terviews with engineering and operations

personnel are important ways to allow the analyst to obtain information that is

helpful when evaluating the output from the life and net sa lvage programs in

relation to the Company’s actual asset ut ilization and environmen t. Information that

was gleaned in these discussions is found bot h in the Detailed Discussion portions

# 18 of the Life Analysis and Salvage Analysis se ctions and also in workpapers. In

addition, Alliance personnel possess a signi ficant understanding of the property and

its forces of retirement due to years of day-to-day exposure to property and

operations of electric utility property.

Phase 2 is where the SPR and actuarial analysis are performed. Phase 2

and Phase 3 (to be discussed in the next paragraph) overlap to a significant

degree. The detailed property records info rmation is used in Phase 2 to develop

observed life tables for life analysis and SPR graphs and statistics. It is possible

that the analyst would cycle back to th is phase based on the evaluation process

performed in Phase 3. Net salvage analysis consists of compilin g historical salvage

and removal data by functional group and acc ount to determine values and trends

in gross salvage and removal cost. This information was then carried forward into

Phase 3 for the evaluation process.

Phase 3 is the evaluation process, which synthesizes analysis, interviews,

and operational characteristics into a final selection of asset lives and net salvage

parameters. The historical analysis fr om Phase 2 is furt her enhanced by the

incorporation of recent or future changes in the characteristics or operations of

assets that were revealed in Phase 1. The preliminary results are then reviewed by

the depreciation analyst and discussed with accounting and operations personnel.

Phases 2 and 3 allow the depreciation analyst to validate the asset characteristics

as seen in the accounting transacti ons with actual Co mpany operational

experience.

Finally, Phase 4 involved the calc ulation of accrual rates, making

recommendations and documenting the conc lusions in a final report. The

calculation of accrual rates is found in Appendix A. Recommendations for the

various accounts are contained within the Detailed Discussion of this report. The

depreciation study flow di agram shown as Figure 1 3 

# documents the steps used in

conducting this study. Depreciation Systems on page 289 documents the same

basic processes in performing a depreciation study.

3 

# Introduction to Depreciation for Public Utilities and Other Industries, AGA EEI, 2013

# 19

# 20 Production Depreciation Calculation Process

Annual depreciation expense amounts for the Steam Production and Other

Production accounts were calculated by the st raight line, remaining life procedure.

In a whole life representati on, the annual accrual rate is computed by the following

equation,

Annual Accrual Rate = (100% - Net Salvage Percent)

Average Service Life



# In the case of steam produc tion facilities with a terminal life and interim retirement

curve, each vintage within the group has a unique average service life and

remaining life determined by computing the area under the truncated Iowa Curve

coupled with the group’s terminal life. For other production, no interim retirement

curve is used so there is no truncated su rvivor curve in that instance.

Use of the remaining life deprecia tion system adds a self-correcting

mechanism, which accounts for any di fferences between theoretical and book

depreciation reserve over the remaining life of the group. For each vintage

modeled with an interim retirement curve and terminal life,

Remaining Life (i) = Area Under Survivor Curve to the Right of Age (i)

Survivors (i)

And

Average Service Life = Area Under Survivor Curve

Survivors at Age Zero



# With the straight line, remaining life, average life group system using Iowa Curves,

composite remaining lives were calculated by computing a direct weighted average

of each remaining life by vintage within the group. Within each group (plant

account/ unit), for each plant account, the difference between the surviving

investment, adjusted for estimated net salvage, and the allocated book depreciation

reserve, was divided by the composite remaining life to yield the annual

depreciation expense as noted in this equation.

# 21 Annual Depreciation Expense = Original Cost – Book Reserve – (Original Cost * Net Salvage %)

Remaining Life



# where the net salvage percent r epresents future net salvage.

Within a group, the sum of the group annual depreciation expense amounts,

as a percentage of the deprec iable original cost inve stment summed, gives the

annual depreciation rate as shown below:

Annual Depreciation Rate = ∑ Annual Depreciation Expense

∑ Original Cost



# These calculations are show n in Appendix A. The calcul ations of the theoretical

depreciation reserve values and the corres ponding remaining life calculations are

shown in the workpapers. Book depreciation reserves are maintained on a plant

account/unit level basis. Theoretical reserv e computations were used to reallocate

depreciation reserves by account and to compute remaining life for each group.

Computations for other production asse ts mirror those shown above, with the

exception that there is no interim surv ivor curve for other production assets.

Transmission, Distribution a nd General Calculation Process

Annual depreciation expense amounts for Transmission excluding

Substations, Transmission Substations, Dis tribution Substation, Distribution

excluding Substations, and General accounts we re calculated by the straight line,

average life group, remaining life procedure

In a whole life representation, the annual accrual rate is computed by the

following equation,

Annual Accrual Rate = (100% - Net Salvage Percent)

Average Service Life



# Use of the remaining life deprecia tion system adds a self-correcting

mechanism, which accounts for any di fferences between theoretical and book

# 22 depreciation reserve over the remaining life of the group. With the straight line,

remaining life, average life group system using Iowa Curves, composite remaining

lives were calculated according to st andard broad group expectancy techniques,

noted in the formula below:

Composite Remaining Life = ( ∑ Original Cost - Theoretical Reserve)

∑ Whole Life Annual Accrual



# For each plant account, the differenc e between the surviving investment,

adjusted for estimated net salvage, and t he allocated book depreciation reserve,

was divided by the composite remaining life to yield the annual depreciation

expense as noted in this equation.

Annual Depreciation Expense = Original Cost - Book Reserve - (Original Cost * Net Salvage %)

Composite Remaining Life



# where the net salvage percent r epresents future net salvage.

Within a group, the sum of the group annual depreciation expense amounts,

as a percentage of the deprec iable original cost investment summed, gives the

annual depreciation rate as shown below:

Annual Depreciation Rate = ∑ Annual Depreciation Expense

∑ Original Cost



# These calculations are shown in A ppendix A. The calculations of the

theoretical depreciation reserve values and the corresponding remaining life

calculations are shown in the workpaper s for this study. Book depreciation

reserves are maintained on a plant account level basis and theoretical reserve

computation was used to compute composite remaining life for each account.

Vintage Group Amortization

The Company requests continued use of vintage group amortization for

assets in account 391-398. Vintage gr oup amortization has been approved in

numerous jurisdictions and is described in FERC Accounting Release 15. Under

# 23 this proposal, assets in account 391- 398 will be retired when they reach the

average service life of the gr oup. As agreed to in the U nanimous Stipulation from

Commission Docket No. 35763, the Company has reviewed the life and net salvage

parameters for all accounts in this group. In the life analysis and salvage analysis

sections, recommended changes to each account describe the depreciation

parameters requested for t hose accounts. The depreciation accrual for general

plant will change to reflect the reserve pos ition of the various accounts and small

changes in life parameters and net salv age percentages. This will allow the

Company to continue to track small dolla r general plant items in a more cost

efficient manner. As previously noted, t he Company is requesting approval so no

further justification of t he proposed life and net salvage par ameters be required in

the future.

# 24 LIFE ANALYSIS

Steam Production, FERC Accounts 311-316

Terminal Retirement Date

The terminal retirement date refers to the year in which a generating unit will

be retired from service. The retirement can be for a number of reasons such as the

physical end of the generating unit but will generally be driven by economic

retirement of the unit. SPS personnel provi ded their estimated re tirement dates for

each generating unit. These dates are bas ed on the current pl ans and investment

in the generating units. Retirement dat es for generating units can be found in

Appendix D. As new investment is committed to these units or decisions made that

units are not economically viable, these reti rement dates may change. At this time,

these retirement dates are the best estimate of the current lives remaining in the

generating assets.

Interim Retirement Curve

Historical data used to develop interim retirement curves represent an

aggregate of many property units in a group. Some of those assets may be long

lived, and others may have a short life. T he average of those is represented by an

interim retirement curve for the group. A group can be a plant account or a

functional group. The interim retirement curve is “truncated” (i.e. cut off) at the age

the unit will retire. In other words, if one finds through the analysis that 10 percent

of the property in an account will be retir ed and replaced prior to the end of the life

of the unit, the interim retirement curve will model those retireme nts across the rest

of the life of the unit. If a pump is only going to last 10 years but the unit is

projected to last 20 years, the shorter life of the pump should affect the depreciation

expense charged over the next 10 years. When analyzing a large pool of assets

like power plant accounts, these shorte r lived items can be accurately modeled

together statistically. Thus, given that inte rim retirements will occur, this statistical

analysis enables one to measure the interi m retirement curves applicable to

property groups.

Some examples of “long lived” property that are projected to last until the

# 25 retirement of a unit are: Roads, Br idges, Railroad track, Intake/Discharge

Structures, Structural Steel (and misc. steel), Cooling towers, Buildings, Cranes,

Dams, Ponds, Basins, Canals, Foundati ons, Stacking and Reclaiming equipment,

Surge Silos, Crushers, Transfer Towe rs, Fly Ash and Bottom Ash Systems,

Precipitators, Bag Houses, Stack, Turb ine (except blades) and Piping, Generator

Cooling System, Vacuum Systems, Generator and Main Leads, Station

Transformers, Conduits and Ducts, Stat ion Grounding System, Start-up Diesel

Generators, and Stores Equipment.

Some examples of “shorter lived” property that are projected to retire prior to

the retirement of the unit are: fences, se curity systems, , air compressors, fuel oil

heaters, heating, ventilation and air conditioners, piping, motors, pumps, conveyors,

, air preheaters, economizers, contro l equipment, feedwater heaters, boiler

feedwater pumps, forced draft (FD) and induced draft (ID) fans, scrubbers,

continuous emissions monitoring systems (CEM), turbine blades and buckets,

turbine plant instruments, condensers, control equipment, station service

switchgear, and universal power supply (UPS) batteries.

SPS has only unaged data available for histor ical analysis in this category.

For each generating unit within the group, annual additions, retirements, transfers,

and balances were available from 1970 forwar d. Since the goal of the life analysis

was to model retirement activity for non- terminal events, units which were retired

(even though they may have been returned to service later), such as Moore County

were not aggregated into the group. Asse ts from FERC Accounts 311-316 were

analyzed for SPR analysis. Although some Conformance Indices (“CI”) were

excellent, curves with Retirement Experienc e Indices (“REI”) in the excellent range

had lives that were not reasonable for use as interim retirement curves for power

plant property. For example, curves with excellent REIs had lives in the range of

35-45 years for many of the bands. Curves that were in the more normal range for

interim retirement curves had REIs only in the fair range. A further discussion of

the selection of interim retirement cu rves for the steam generating accounts 311-

316 follows in the Detailed Discussion section.

# 26 PRODUCTION PLANT

Production Accounts, FE RC Accounts 311.0-316.0

The company has eight Fossil Producti on generating sites included in this

study: Cunningham, Harrington, Jones, Maddox , Moore County, Nichols, Plant X,

and Tolk. Currently, authorized depreciation ra tes do not recognize that any assets

will retire prior to the end of t he life of the generating units.

Historical data for all units was combi ned by account in accounts 311-316 to

analyze historic activity and develop propos ed interim retirement curves. This

combined experience across various generati ng units was used as a representation

of SPS’ retirement history for fossil producti on to model future re tirement activity.

Proposed interim retirement lives and disper sion curves to reflect the recognition

that some assets at each plant will retire pr ior to the end of the life of the unit were

analyzed at an account level for all generating assets within each account.

# 27 LIFE ANALYSIS

The life analysis was performed on a calendar year-end basis, which is

as of December 31, 2012. All data for plant balances given in the descriptions

below is as of June 30, 2013.

Steam Production

FERC Account 311.0 Structures and Improvements (74 R2)

This account consists of buildings, st ructures, fences, lighting systems, and

other related assets at each power plant. Retirement dates for each unit are found

in Appendix D. The current balance in this account is $216 million. The top ranked

curve is a 74 R2 with excellent CI but poor REIs. After reviewi ng visual matches of

various curves and considering the types of assets in this account, this study

recommends a 74 R2 dispersion curve for in terim retirements. A graph of the

actual versus simulated balances is shown below.

# 28 FERC Account 312.0 Boiler Plant Equipment (58 R2)

This account consists of boiler plant equipment, bag houses, preheaters and

other related equipment. Re tirement dates for each unit are found in Appendix D.

The current balance in this account is $921 million. For bands 20 years and longer,

the 58 R2 curve is the top ra nked choice. After examining plots of simulated versus

actual balances and taking into considerati on the types of assets in this account,

this study recommends a 58 R2 dispersion curve for interim retirements. A graph

of the actual versus simulated balances is shown below.

# 29 FERC Account 314.0 Turbogenerator Equipment (71 R1.5)

This account consists of tur bogenerator equipment, stationary blades,

turbine control systems, and other related a ssets at each power plant. Retirement

dates for each unit are found in Appendix D. The current balance in this account is

$447 million. Many of the top ranked curv es produce lives that are much longer

than used across the industry. However, the 71 R1.5 was in the top three ranked

curves and after examining comparison of actual versus simulated balances and

considering the characteristi cs of the assets in the account, this study recommends

a 71 R1.5 dispersion curve. A graph of t he actual versus simulated balances is

shown below.

# 30 FERC Account 315.0 Accessory Electric Equipment (64 L2.5)

This account consists of power transformer, regulators and related assets at

each power plant. Retirement dates for eac h unit are found in Appendix D. The

current balance in this account is $73 milli on. In bands from 20 to 40 years, the 64

L2.5 curve is the top choice. After revi ewing plots of actual versus simulated

balances and considering the characteristics of the assets in this account, this

study recommends a 64 L2.5 dispersion curv e. A graph of the actual versus

simulated balances is shown below.

# 31 FERC Accounts 316.0 Miscellaneous Power Plant Equipment (56 S0)

This account consists of tanks, pumps, work equipment, and other related

assets at each power plant. Retirement dates for each unit are found in Appendix

D. The current balance in this account is $31 million. In bands from 15 to 40 years,

the 56 S05 curve is the top choice. After re viewing plots of act ual versus simulated

balances and examining the types of assets in the account, this study recommends

a 56 S0 dispersion curve. A graph of t he actual versus simulated balances is

shown below.

# 32 Other Production, FERC Accounts 340-346

Terminal Retirement Date

The terminal retirement date refers to the year in which a generating unit will

be retired from service. The retirement can be for a number of reasons such as the

physical end of the generating unit, but will generally be driven by economic

retirement of the unit. SPS personnel provi ded their estimated re tirement dates for

each generating unit. These dates are bas ed on the current plans and investment

in the generating units. Retirement dat es for generating units can be found in

Appendix D. As new investment is committed to these unit s or decisions made that

units are not economically viable, these reti rement dates may change. At this time,

these retirement dates are the best Co mpany estimate of the current lives

remaining in the generating assets.

Interim Retirement Curve

In examining data for Other Production, FERC Accounts 340-346, very few

retirements have occurred over the avail able data since 1970. The only significant

retirements excluded from t he study were the terminal retirements of Celanese,

Riverview, and Tucumcari. Given the lack of retirement data, no interim retirement

curve was used in developing depreciation es timates for other production facilities.

# 33 Transmission Accounts, FERC Accounts 350-358

SPS has a wide service territory across Texas and New Mexico. There are

significant Transmission assets in substation equipment as well as poles and

overhead conductor. During the late 1990s and early 2000s, (afte r the merger with

Public Service Company of Colorado that created New Century Energies, Inc., but

prior to the merger creating Xcel Energy ) SPS data reflected a dramatic decrease

in retirements (and in some cases no re tirements) due to resource constraints

causing retirements not to be made by the predecessor accounting group. Since

that time, the Company has focused signific ant effort on bringing retirements up to

date. In 2005, these “catch-up” retirem ents were placed in the year they would

have originally retired. There were no further adjustments for “catch-up”

retirements after 2006.

# 34 FERC Account 350 Transmission Depreciable Land Rights (80 R4)

This account consists of land rights and easements associated with

Transmission lines or Transmission substa tions. The account balance for this

account is $62.6 million. The Unanimous Stipulation in Commission Docket No.

35763 established a life of 70 years with a R4 dispersion. There is minimal

retirement activity in this account, which did not produce sufficient data for an

actuarial analysis. Since t he lives of many accounts in the transmission function

are lengthening, this study recommends a change to an 80 R4 dispersion for this

account.

# 35 FERC Account 352 Transmission Substati on Structures and Improvements

(65 R4)

This account includes buildings, fenc ing and other struct ures found in a

transmission substation. The account balanc e for this account is $41.8 million.

The approved life and curve agreed to in t he Unanimous Stipulation in Commission

Docket No. 35763 is a 55 R4. Limited retire ments make actuarial analysis difficult

since few retirements have occurred in th is account. Although a 65-year life is on

the high side of what woul d be expected in the industry, a 65 year life is

recommended with retention of the R4 dispersion.

# 36 FERC Account 353 Transmission Substation Equipment (57 R2.5)

This account contains a wide vari ety of transmission substation equipment,

from circuit breakers to switchgear. The ac count balance for this account is $519.5

million. The Unanimous Stipulation in Commission Docket No. 35763 established a

life characteristic of R4 55. SPS has an excellent inspection and maintenance

program related to substation equipmen t. This program detects and corrects

problems with large substati on components in a timely manner to keep equipment

in service longer than without this program. This program would have a tendency

to reduce early failures. It appears that bec ause of this program , the indicated life

of substation equipment has lengthened since the last st udy and is longer than the

expectations of many other utilities in Te xas. The 57 year life with the R2.5

dispersion is a good match for all of the placement and experience band

combinations. This study recommends mo ving to a 57 R2.5 for this account.

# 37 FERC Account 354 Transmission Towers and Fixtures (75 R3)

This account consists of Transmission towers, which are used to transmit

electricity at a voltage of 69 kV and above. The account balance for this account is

$8.3 million. Most of the Transmission line assets are in FERC Account 355, Poles

and Fixtures. Twenty-five mile s out of 6500 miles of line are in this account. There

are three short tower lines (one in town of 5 miles and two in Lubbock – 10 miles

long each). The 5 mile long stretch was built in the 1940s and the 20 miles around

Lubbock was built in the 1970s. There is ve ry limited retirement data, the last

retirement occurred in 1989. The prior depreciation study established a 75 R3 life

which Company personnel feel appropriate for these assets. Judgment was used

to retain the current life estimate of 75 R3.

# 38 FERC Account 355 Transmission Poles and Fixtures (54 R3)

This account consists of Transmission poles and fixtures, which are used to

transmit electricity at a voltage of 69 kV and above. The account balance for this

account is $502.3 million. The Unanimous Stipulation in Commission Docket No.

35763 established a 40 year life with a R5 dispersion. After reviewing actuarial

analyses results, the life of transmission poles is increasing from the prior

depreciation study. That increase shoul d be moderated by Company specific

circumstances. The Company is beginning to use more steel than wood compared

to the past. A number of lines are entirely made of steel, some with wood tangents

and steel corners, and double circuit lines are now steel. The Company has in

excess of 6,500 miles of transmission li ne with approximately 10% - 15% of the

poles being steel. Some wood pole lines are in excess of 50 years old, although

many of those poles have been replaced. Some of the oldest steel poles are

approaching 40 years of age. The Company has issues with some lines where

design and soil conditions are not optimal. A change from white cedar (which

lasted longer) to Douglas fir was made. Ne w growth trees will not last as long as

old growth trees and 60% to 65% of exis ting wood poles are old growth. Many

older wood transmission poles of an older des ign class will not take the weight of

reconductoring. Most steel poles were on foundations and now 40% of steel poles

are direct buried. Arms ar e replaced more often than poles. Viewing the overall

band shows a shorter life of 40 years similar to the Company’s approved life. When

viewing more recent placement and exper ience bands, life in this account is

increasing and the dispersion is shifti ng from a high mode R to mid-range R

dispersion. Based on the actuarial analysis of more recent placement and

experience bands, as well as feedback from Company personnel, a 54 R3 life is

recommended for this account.

# 39

# 40 FERC Account 356 Transmission Overhead Conductor (49 R2.5)

This account consists of Transmissi on overhead conductors, which are used

to transmit electricity at voltages of 69 kV and above. The account balance for this

account is $223.7 million. The Unanimous Stipulation in Commission Docket No.

35763 established a life of 42 y ears with a R2.5 dispersion. The Company did not

use dampers in the past and began usi ng dampers 25 years ago. Company

personnel found that wires were not last ing as long without dampers because of

shattering at insulators, which they expect to continue seeing residual effects of not

using dampers for many years. The Company will replace the wire in many

instances when moving from single to double circuit conductor line, and more

opportunities are occurring to upgrade lines. Company would expect a little shorter

life for conductor than poles. Based on the ac tuarial analysis, the life indication is

moving longer. Based on more recent experience bands and input from Company

personnel, this study recommends a 49 year life with a R2.5 dispersion for this

account.

# 41 FERC Account 357 Transmission Underground Conduit (75 R3)

This account consists of underground conduit used with two underground

transmission lines in Amarillo. The a ccount balance for this account is $255

thousand. There has been no retirement acti vity over the study period, rendering

both actuarial and SPR analysis of no aid in examining lif e characteristic. The

Unanimous Stipulation in Commission Docket No. 35763 established a life of 75

years with a R3 dispersion through judgment. This study recomm ends retaining the

currently approved life of 75 years with a R3 dispersion for this account.

FERC Account 358 Transmission Underground Conductor (45 R3)

This account consists of under ground conductor used in two underground

transmission lines in Amarillo. The a ccount balance for this account is $490

thousand. The lines are low pressure, oil filled, paper wrapped 500 MCM copper

cable. The Unanimous Stipulation in Commission Docket No. 35763 established a

life of 45 years with a R3 dispersi on through judgment. There has been no

retirement activity over the study peri od, rendering both actuarial and SPR analysis

of no aid in examining life characteristic. This study recommends retaining the

currently approved life of 45 years with a R3 dispersion for this account.

# 42 Distribution Accounts, FERC Accounts 360-373

SPS has a wide service territory across two states after the sale of the

Kansas/Oklahoma territory. There are signifi cant Distribution assets in substation

equipment, poles, overhead conductor, servic es, line transformers, meters, and

street lighting. During the late 1990s and ear ly 2000s, (prior to the merger creating

Xcel Energy) SPS data reflected a dramatic decrease in retirements (and in some

cases no retirements) due to resource cons traints causing retirements not to be

made by the predecessor accounting group. Since that time, Xcel Energy has

focused significant effort on bringing retire ments up to date. In this study, these

“catch-up” retirements are pl aced in the year they would have originally retired.

Since 2006, there has been no “c atch-up” activity to adjust. For mass Distribution

accounts, FERC Accounts 364 through 373, only unaged data is available. Life

and net salvage for Distribution plant incl uded total Company assets. To compute

depreciation rates for this study, Texa s only plant balances and depreciation

reserves were used.

FERC Account 360 Distribution De preciable Land Rights (60 R4)

This account consists of land rights and easements associated with

Distribution property or Distr ibution substations. The total Company plant balance

for this account is $4.5 million and the Te xas only plant balance is $1.7 million.

There was minimal retirement activity, wh ich did not produce sufficient data for an

actuarial or SPR analysis. The Unanim ous Stipulation in Commission Docket No.

35763 established a life of 60 y ears with a R4 dispersion. Judgment was used to

retain a 60 year life with a R4 dispersion for this account.

# 43 FERC Account 361 Distribution Substati on Structures and Improvements

(60 R1.5)

This grouping contains fencing and ot her structures at a distribution

substation. The total Company plant bal ance for this account is $7.5 million and

the Texas only plant balance is $4.9 million. The U nanimous Stipulation in

Commission Docket No. 35763 established a life for the combined Accounts 361

and 362 of 52 years with a R2 dispersion. Generally, distribution substation

structures do not last as long as fa cilities in Account 352 (Transmission –

Structures and Improvements). There ar e still some wood structures across the

SPS system. Based on visual matching and the mix of assets in this account, a 60

R1.5 life is recommended for this account.

# 44 FERC Account 362 Distribution Substations (55 R1.5)

This grouping contains a wide variet y of distribution substation equipment,

from circuit breakers to switchgear. T he total Company plant balance for this

account is $158.7 million, and the Texas onl y plant balance is $98.9 million. The

Unanimous Stipulation in Commission Do cket No. 35763 established a life for the

combined Accounts 361 and 362 of 52 years wit h a R2 dispersion. With more

experience years, the accounts were separat ed for this study. Company personnel

estimate the following lives, used for planning purposes, for components in this

account: 50 years for transformers, 65 for breakers, 50 for r egulators and 30 years

for relay. Primary reasons for replacement are: failure, testing indicating elevated

risk of failure, capacity increases (especially for circuit breakers), obsolescence,

safety hazard related to catastrophic failure mode (and risk is increasing), and

proactive replacements of aging assets. SPS has more radial substations in SPS

than many companies. Based on visual matching and input from Company

personnel, a 55 year life with a R1.5 dis persion is recommended for this account.

# 45 FERC Account 364 Distribution Poles, Towers, and Fixtures (52 R0.5)

This account contains poles and towers of various material types: wood,

concrete, and steel. The total Company pl ant balance for this account is $196.7

million, and the Texas only plant balance is $139.5 million. Most of the poles are

made of wood but there are a few steel and concrete poles in highly specialized

situations. The height ranges from 30 feet to 60 feet with 40 f eet and 45 feet being

prevalent. The Unanimous Stipul ation in Commission Docket No. 35763

established a life for this a ccount of 40 years with a S1 dispersion. The Company

has a pole testing program which began 3-4 y ears ago. The goal is to test 10% of

the Company’s poles per year. Poles are given ratings: P1 (replace within 90

days), P2 (replace within one year), and P3 (replace within 3 years or sleeve/band).

With this program, the P1s have a shorte r life than might have occurred otherwise.

Capital spending has increased due to pol e replacements. Accidents, general

construction, storms, fires, relocati ons, and conversions from overhead to

underground are all drivers of retirement. Company personnel expe ct the life to be

longer than the currently approved 40 years. After reviewing SPR results and

considering input from Company personnel, this study recommends moving to a 52

year life with a R0.5 dispersion for this account. A plot of the actual versus

simulated balances is shown below.

# 46

# 47 FERC Account 365 Distribution Overhead Conductor (47 R0.5)

This account consists of overhead conductor of various thickness, as well as

various switches and reclosers. The total Company plant balance for this account

is $188.3 million, and the Texas only plant balance is $132.7 million. The

Unanimous Stipulation in Commission Docket No. 35763 established a life of 40

years with a S1 dispersion. Upgrades, re conductoring, and storms are the largest

causes of retirement. Even with storms , the Company will replace poles and lift

existing conductor back on new poles when po ssible. Some smaller conductor is

deteriorating at 35-40 year s, but Company personnel do not believe the approved

40 year life is indicative of current assets in this account. Conformance Indices

(“CIs”) were low for all except the shor test bands. A low mode dispersion is

reflected across all bands. After reviewi ng SPR results and considering input from

Company personnel, this study recommends moving to a 47 year life with a R0.5

dispersion for this account. A plot of the actual versus simulated balances is shown

below.

# 48 FERC Account 366 Distribution Underground Conduit (60 R2.5)

This account consists of Distribut ion conduit, duct banks, vaults, manholes,

and ventilating system equipment. The tota l Company plant balance for this

account is $22.1 million, and the Texas only plant balance is $16.4 million. The

Unanimous Stipulation in Commission Docke t No. 35763 established a life for this

account of 40 years with a R4 dispersion. High ranking curves have unacceptable

Retirement Experience Indices (REIs) and the lives are outside of a reasonable

range for this account. The R2.5 disper sion has a good REI and a CI in the good to

excellent range. The various bands show the lif e increasing to 60 years. This study

recommends moving from a 40 year life to a 60 year life with a R2.5 dispersion for

this account. A plot of the actual versus simulated balances is shown below.

# 49 FERC Account 367 Distribution Underground Conductor (47 R1.5)

This account consists of Distributi on conductor, switches, and switchgear.

The total Company plant balance for this account is $30.6 million, and the Texas

only plant balance is $23.2 million. Docket No. 35763 established a life for this

account of 41 years with a R2 .5 dispersion. The R1.5 dispersion has one of the

best rankings with an excellent REI. While the R1 curve has a higher CI, the R1.5

provides a better REI with CIs that are in the same range. This study recommends

moving from a 41 year life to a 47 year life with a R1.5 dispersion for this account.

A plot of the actual versus simulated balances is shown below.

# 50 FERC Account 368 Distribution Line Transformer (45 R1)

This account consists of line transfo rmers, regulators, and capacitors. The

total Company plant balance for this acc ount is $167.5 million, and the Texas only

plant balance is $140.1 million. The Unani mous Stipulation in Commission Docket

No. 35763 established a life for this account of 45 years with a R1.5 dispersion.

The Company has a number of live front pad mount tr ansformers, which they will

replace with dead front if tr ansformer is replaced for other reasons. The split

between overhead and pad mount transformers is 85% and 15%, respectively.

Lightning and heat are big drivers for over head replacements. Pads replacements

are driven more by growth (capacity needs) or faults, and they also have more rust

issues due to watering and chemicals. Transformers are not repaired (stopped

repairing about 10 years ago) but retired. Company personnel expect to see a

shorter life than in the past due to the di scontinuation of the repair process and the

quality of the materials now. Given i nput from Company personnel, this study

recommends retaining the approved 45 year lif e while moving to a R1 dispersion for

this account. A plot of the actual versus simulated balances is shown below.

# 51 FERC Account 369 Distribution Services (44 R2)

This account includes all Distri bution services, both overhead and

underground. The total Company plant balanc e for this account is $71.4 million,

and the Texas only plant balanc e is $49.2 million. The Unanimous Stipulation in

Commission Docket No. 35763 established a life for this account of 42 years with a

R2 dispersion. Services are split between 40% underground and 60% overhead.

Life of overhead is impacted by vegetation, insulation failure, and load growth.

Underground life would be im pacted by dig-ins and age of cable. Company

personnel expect the life to be lower t han currently approved but best ranked and

fits show a slight increas e from the existing. All bands except the very youngest

exhibited low CIs. To move in the direct ion of the trend indicat ed in the analysis but

tempering by information provided by Co mpany experts, this study recommends

moving to a 44 year life with a R2 dispersion for this account. A plot of the actual

versus simulated balances is shown below.

# 52 FERC Account 370 Distribution Meters (40 R2)

This account includes all Distribut ion meters. The total Company plant

balance for this account is $62.1 million, and the Texas only plant balance is $48

million. The Unanimous Stipulation in Commission Docket No. 35763 established a

life for this account of 38 y ears with a R5 dispersion. Oil field and irrigation meters

were changed to demand meters in 2006-2007 ( about 14 thousand meters out of a

population of 380 thousand). The Company has many electromechanical meters,

but has begun to buy digital meters (ove r the past 10-15 years) with approximately

20% of the meters being electronic now. The Company performs random tests of

meters (exchange for electronic and bri ng old one in). The Company is

experiencing slightly longer lives for el ectromechanical meters. The Company no

longer repairs meters (stopped approxim ately 10 years ago) and discards any

electromechanical meter. This has the e ffect of mitigating the life increase for

electromechanical meters. Also mitigating the overall life for the account is the

increasing balance of electronic meters in the account. Electronic meters will be

reused if they test positive. Company personnel expect digital meters will not have

as long a life as the electromechanical meters , with life of electroni c meters to be in

the 15-20 year life range compared to el ectromechanical meters lasting 30-40

years or longer. As an increasing percent age of this account is converted to

electronic meters, the life for this account is expected to decrease. For commercial

meters, the related instrument transforme rs would have a longer life (around 30

years). The commercial meters would be electronic and follow the same 15 to 20

year life as other electronic meters. Ba sed on the current asset make-up for this

account, this study recommends moving to a 40 year life with a R2 dispersion for

this account. A plot of the actual versus simulated balances is shown below.

# 53

# 54 FERC Account 371 Installation on Custom er Premises (Guard Lights) (25

R0.5)

This account consists of guard light s and guard light standards. The total

Company plant balance for this account is $13.1 million, and the Texas only plant

balance is $8.1 million. The Unanimous Stipulation in Commission Docket No.

35763 established a life for this account of 18 years with a R2 dispersion. Since

2006, the Company has stopped adding new guar d lights but will maintain existing

assets. All bands exhibited low CIs. The R0.5 dispersion has one of the best

rankings with an excellent REI. This st udy recommends moving to a 25 year life

with a R0.5 dispersion for this account. A plot of the actual versus simulated

balances is shown below.

# 55 FERC Account 373 Distribution Street Lighting (41 R2)

This account includes all Distributi on streetlights, conductor, conduit,

luminaire, and standards. The total Company plant balance for this account is

$22.4 million, and the Texas only plant bal ance is $12.9 million. The Unanimous

Stipulation in Commission Docket No. 35763 es tablished a life for this account of

38 years with a R3 dispersion. Over the la st two or three years, the Company has

gone to cobra style head HPS from mercury. The Federal Energy Policy Act of

2005 required discontinuation of mercury vapor ballasts after Jan 2008 (2014 for

bulbs). This will drive a retirement/repl acement of all mercury equipment in the

next few years. Company experts state t hat 70% of system is mercury. They

anticipate that all assets except bulbs and ballasts (replacement is O&M) will last

35 to 40 years. Head replacem ent (e.g. replacing Mercury vapor to HPS) is capital.

To move in the direction of this change and the indications starting in the 25 year

band, this study recommends moving to a 41 y ear life with a R2 dispersion for this

account. A plot of the actual versus simulated balances is shown below.

# 56 General Plant, FERC Accounts 389-398

For general plant accounts 389-390, the Company proposes to continue using

actuarial or semi-actuarial analysis. For all other general plant accounts (391-398),

the Company proposes to continue the use of Accounting Release Number 15

(“AR15”), which is a vintage year a ccounting method approved by the FERC,

Vintage Year Accounting Fo r General Plant Accounts , dated January 1, 1997. AR15 allowed utilities to use a simplified method of accounting for general plant

assets, excluding structures and improvement s (referred to as “general plant”). The

AR-15 release allowed high volume, low co st assets to be amortized over their

associated useful life, elim inated the need to track indi vidual assets, and allowed a

retirement to be booked at the end of the depreciable life. This method is often

referred to as “amortization of general plant.”

The Stipulation Agreement in Docke t 35763 stated that “SPS shall fully

justify the continued use of the assumed under lying amortization period reflected in

the vintage group accounting in all future ra te cases for each account”. In this

proceeding, the Company requests that the lives and net salvage amounts

proposed be approved and no furt her justification of those parameters will be

required in subsequent proceedings.

The plant asset balances are mainta ined by vintage installed with the

retirement being recorded when book deprec iation have been completed. The

empirical retirement data for actuarial or semi-actuarial analysis will no longer be

reliable, however, the determination of useful life can be made appropriately with

the use of market forces, manufacturer expected life, technological obsolescence,

business planning, known causes of reti rement, and changes in expected future

utilization.

The depreciation calculation uses a usef ul life applied to a vintage versus the

entire account. The depreciation recovery is complete when the vintage

accumulated depreciation is equal to t he vintage plant adjusted for estimated

salvage and removal costs.

# 57 FERC Account 389 General Plant Depreciable Land Rights (55 R4)

This account consists of land right s and easements associated with general

property or general structur es and improvements. The plant balance for this

account is $46 thousand. Currently land ri ghts are depreciated ov er a 50-year life

with a R4 dispersion. In many cases, t he lives of individual land rights are tied to

the structures that rest on them. Since this study proposes an increase in the life

for Account 390, Structures and Improvements, an increase of 5 years in the life for

this account is recommended. Therefore, a 55-year life with a R4 dispersion is

recommended.

# 58 FERC Account 390 General Structures and Improvements (52 R1.5)

This account consists of general stru ctures and improvements for buildings,

including roofing, plumbing, and air condi tioning systems. The plant balance for

this account is $61.2 million. The U nanimous Stipulation in Commission Docket

No. 35763 established a life of 45 years with a R2 dispersion. Company personnel

provided estimates of various building components: roofs at 20 years, HVAC

systems (which would include boilers, cooling to wers, chillers, etc.) at 15 years, big

chillers at 30 years, and parking lots at 15-20 years. The average age of buildings

is over 20-30 years (newest was built in 1996- 7), while others are 40 years or older.

(For example, the Amarillo Customer Service C enter was built in 1968). Complete

renovations generally occur on older build ings (20-30 years old). The Company

reviews its office assets at each 20 year refresh cycle. Actuarial analysis shows a

52 year life with a R1.5 dispersion is one of the best matches. This study

recommends moving from a 45 R2 to a 52 y ear life with a slightly flatter R1.5

dispersion for this account.

# 59 GENERAL PLANT AMORTIZED ACCOUNTS

FERC Account 391 Office Furniture and Equipment (25 SQ)

This account consists of miscellaneous office furniture such as desks, chairs,

filing cabinets, and tables used for general utility service. T here is approximately

$10.3 million in this account, and after retire ment of fully accrued assets the plant

balance is $8.5 million. This study reco mmends retention of a 25 year life with a

SQ dispersion. The currently approved dispersion is L1.5.

FERC Account 391 Computer Equipment (5 SQ)

This account consists of network co mputer equipment used for general utility

service. There is approxim ately $19.5 million in this a ccount, and after retirement

of fully accrued assets the plant balance is $18.70 million. The account has an

approved life of 5 years with a SQ dispersion and is retained. The currently

approved dispersion is R2.

FERC Account 392 Transportation Equipment (11 SQ)

This account consists of automob iles, trucks, trailers, and other

transportation equipment that is a licensed vehicle. T here is approximately $68.6

million in this account. However, after AR 15 retirements are made due to assets

exceeding their recommended life, the balance in this account will be $49.2 million.

The Unanimous Stipulation in Commi ssion Docket No. 35763 established a life of

11 years with a L3 dispersion. This study recommends ret ention of the 11 year life

with a SQ dispersion.

FERC Account 393 Stores Equipment (35 SQ)

This account consists of stores equipm ent used for general utility service.

There is approximately $460 thousand in this account. However, after AR 15

retirements are made due to assets exc eeding their recommended life, the balance

in this account will be approximately $391 thous and. This account currently has an

approved life of 45 year s with a R2.5 dispersion curve. This study recommends

# 60 moving the life to 35 SQ consistent with Account 394.

FERC Account 394 Tools, Shop, and Garage Equipment (35 SQ)

This account consists of various it ems or tools used in shop and garages

such as air compressors, grinders, mixers, hoists, and cranes. There is

approximately $20.2 million in this account. However, after AR 15 retirements are

made due to assets exceeding their recomm ended life, the balance in this account

will move to $19.9 million. This account has an approved life of 35 years with a

S0.5 dispersion curve. This study re commends the currently approved 35 year life

with a SQ dispersion.

FERC Account 395 Laboratory Equipment (25 SQ)

This account consists of laboratory equipment used in general utility service.

There is approximately $10.7 million in th is account. However, after AR 15

retirements are made due to assets exc eeding their recommended life, the balance

in this account will move to $8.1 million. This study re commends retention of the 25

year life and with a SQ dispersion. The currently approved dispersion is R1.

FERC Account 396 Power Operated Equipment (18 SQ)

This account consists of power-oper ated equipment such as bulldozers,

forklifts, pile drivers, and tractors. T here is approximately $9.8 million in this

account. However, after AR 15 retirement s are made due to assets exceeding their

recommended life, the balance in this acc ount will be $8.6 million. The Unanimous

Stipulation in Commission Docket No. 35763 es tablished a life of 18 years with a L2

dispersion. This study recommends t he currently approved 18 year life with a SQ

dispersion.

FERC Account 397 Communication Equipment (23 SQ)

This account consists of miscellaneous communication equipment used in

general utility service. There is approximately $53.6 million in this account.

However, after AR 15 retirements ar e made due to assets exceeding their

# 61 recommended life, the balance in this acc ount will move to $43.7 million. This

account currently has a R4 curve and a life of 23 years. This study recommends

the currently approved 23 year life with a SQ dispersion.

FERC Account 397 Communication Equipment – EMS (23 SQ)

This account consists of Energy Management System (E MS) communication

equipment used in general utility service. The EMS equipment provides an overall

data collection network to monitor and manage load demand on the energy grid.

There is approximately $3.3 million in this account. This account currently has a R4

curve and a life of 23 years. This st udy recommends the currently approved 23

year life with a SQ dispersion.

FERC Account 398 Miscellaneous Equipment (24 SQ)

This account consists of misce llaneous equipment used in general utility

service. There is approximat ely $2.8 million in this acc ount. However, after AR 15

retirements are made due to assets exc eeding their recommended life, the balance

in this account will move to $2.6 million. This study re commends retention of the 24

year life and an SQ dispersion. The cu rrently approved dispersion is L0.5.

# 62 

# SALVAGE ANALYSIS

When a capital asset is retired, physica lly removed from service, and finally

disposed of, terminal retirement is said to have occurred. The residual value of a

terminal retirement is called gross salvage. Net salvage is the difference between

the gross salvage (what the asset was so ld for) and the removal cost (cost to

remove and dispose of the asset).

Gross salvage and cost of removal relat ed to retirements are recorded to the

general ledger in the accumulated provision for depreciation at the time retirements

occur within the system.

Net salvage data by plant account for Transmission, Distribution, and General

Plant is shown in Appendix E. Remova l cost percentages are calculated by

dividing the current cost of re moval by the original installed cost of the asset. Some

plant assets can experience significant negative removal cost percentages due to

the timing of the addition versus the retirement. For example, a Transmission asset

in FERC Account 356 with a current installed cost of $500 (2012) would have had

an installed cost of $64.75 4 

# in 1967. A removal cost of $50 for the asset calculated

(incorrectly) on current installed cost would only have a negative 10 percent

removal cost ($50/$500). However, a correct removal cost calculation would show

a negative 77 percent removal co st for that asset ($50/$64. 75). Inflation from the

time of installation of the asset until the time of its removal must be taken into

account in the calculation of the removal cost percentage because the depreciation

rate, which includes the removal cost percentage, will be applied to the original

installed cost of assets.

4 Using the Handy-Whitman Bulletin No. 177, E-4, line 37, $64.75 = $500 x 72/ 556,

# 63 Salvage - Steam Production and Other Production Property

The concept behind the net salvage cost component of deprec iation rates for

power plants is different from that of Transmission or Distribution assets. Power

plants are discrete units that will need to be dismantled after the end of their useful

lives. Because of this, instead of statis tically analyzing the historical cost for

salvaging and removing assets with rolling and shrinking bands, engineering

studies are conducted to determine the cost to dismantle the individual units or

plants.

The current net salvage rates for Steam Production and Other Production are

five percent positive. The current net sa lvage rates do not fact or in the projected

dismantling costs for SPS facilities. The cu rrent net salvage rates are significantly

lower than the detailed engineering studies performed by TLG Services, Inc. (TLG)

at SPS’s request. The most current Fossil Power Plant Dismantling Cost Study for

SPS was completed in 2012 by TLG and presented in PUC Docket 40824.

However, despite the recent dismantling cost study and the individual experience

and analysis of this study, the Company has decided to use the long standing

precedent of the Texas Commission and retu rn to a negative five percent net

salvage for all Production assets. As rec ently as Docket 39896 (filed in 2011, Final

Order in 2012) for Entergy Texas, the Commission returned a decision retaining the

precedent of negative five percent net sa lvage for Production assets. While the

actual experience and project ed dismantling costs are mu ch more negative, moving

from the currently approved positive five net salvage parameters for Steam and

Other Production adopted in the Unanimous Stipulation for Docket No. 35763

would be a first step in setting depreciation rates that are more reflective of SPS

actual experience and expectations.

# 64 Salvage - Transmission Property

Increasing levels of removal cost are ex perienced in nearly all accounts in this

function. Moving averages, which smoot h out yearly fluctuations between

retirements and net salvage, are used to examine data over the 1968 to 2012

period (or newer depending on the account) and determine net salvage estimates

for each account. Detailed analysis and resu lts by account are shown in Appendix

E-2 and individual account results are discussed below.

FERC Account 350 Transmission Depreciable Land Rights (0 percent)

Retirement activity has been very limit ed in this account. Since land rights

intrinsically have no removal costs (removal costs are attributed to the property on

the land) and have no salvage va lue, a 0 percent net salvage was assigned to this

account.

FERC Account 352 Transmission Substa tion Structures and Improvements

(Negative 15 percent)

The currently approved net salvage esti mate for this account is negative 20

percent. In the 2007 transaction year, a moving average existed of negative 187

and negative 130 for the 5-y ear and 10-year bands, respectively. In the 2012

transaction year, a negative 12 and negative 16 percent exist for the 5-year and 10-

year bands, respectively. There is little re moval cost reflected in this account for

the last several years. Due to less negativ e net salvage indications in more recent

years, even though the 10 year bands statistics show a mo re negative net salvage,

this study recommends moving toward those indications with a net salvage

estimate of negative 15 percent for this acc ount until more information is available.

FERC Account 353 Transmission Stati on Equipment (Negative 19 percent)

The currently approved net salvage esti mate for this account is negative 5

percent. In the most recent period, a moving average of negative 19 percent exists

for the 5-year and a negative 18 percent exis ts for the 10-year band. The most

recent years are fairly consistent and more indicative of future net salvage

# 65 expectations. Therefore, this study reco mmends a move to a negative 19 percent

for this account.

FERC Account 354 Transmission Tower and Fixtures (Negative 5 percent)

The currently approved net salvage estima te for this account is 0 percent.

There has been no salvage or removal recorded in this account in recent years.

Given the small level of retirements and the lack of net salv age transactional data,

this study recommends reflecting a small amount of removal cost with a 5 percent

negative net salvage estimate for this account.

FERC Account 355 Transmission Poles and Fixtures (Negative 60 percent)

The currently approved net salvage esti mate for this account is negative 20

percent. In the most recent period, a moving average of negative 425 and negative

368 percent exists for t he 5-year and 10-year bands, respectively. Throughout

much of the history, a negat ive 60 percent or greater has been experienced in this

account. There is a significant level of re tirements for this conclusion. This study

recommends moving to the indications but limiting the change to a negative 60

percent net salvage estimate for this account at this time.

FERC Account 356 Transmission Overh ead Conductor (Negative 30 percent)

The currently approved net salvage esti mate for this account is negative 10

percent. In the most recent period, a moving average of negative 67 and negative

38 percent exists for the 5-year and 10-y ear bands, respectively. Since 1999, this

account has generally experienced net salv age significantly more negative than

negative 10 percent. The last 5 to 15 years is a more appropriate indicator of future

net salvage for this account. This st udy recommends a negat ive 30 percent net

salvage estimate for this account.

FERC Account 357 Transmission Underground Conduit (0 percent)

The current net salvage estimate for this account is 0 percent. There has

# 66 been only one year, 2012, with retirements re corded during the study period. While

this single year indicates cost of re moval will exceed any sa lvage, there is not

enough data to change the existing 0 percent net salvage estimate at this time and

is retained.

FERC Account 358 Transmission Unde rground Conductor and Devices (0

percent)

The current net salvage estimate for this account is 0 percent. There has

been only two years, 2011 and 2012, with reti rements recorded during the study

period. While these years indicate cost of removal will exceed any salvage, there is

not enough data to change the exis ting 0 percent net salvage estimate at this time

and is retained.

# 67 Salvage – Distribution Property

Increasing levels of removal cost ar e experienced in all accounts in this

function. The salvage received for retir ed assets has decreased over that time

while the removal cost of assets has incr eased dramatically. Also, asset lives have

generally lengthened since the last deprecia tion study, which has the effect of

increasing the net removal cost (creat ing a more negative net salvage percentage)

for the assets. Detailed ana lysis and results by account are shown in Appendix E-2

and individual account results are discussed below.

FERC Account 360 Distribution Depr eciable Land Rights (0 percent)

Retirement activity has been very limit ed in this account. Since land rights

intrinsically have no removal costs (removal costs are attributed to the property on

the land) and have no salvage va lue, a 0 percent net salvage estimate is retained

for this account.

FERC Account 361 Distribution Substati on Structures and Improvements

(Negative 10 percent)

The current net salvage estimate for this account is negative 15 percent.

Transactional history shows a negative net salv age in all years. In the most recent

period, a moving average of negative 4 and negat ive 9 percent exists for the 5-year

and 10-year bands, respectively. Based on the transactional history, a negative

15% net salvage is indicated for numerous years but has started to show some

change. Since there is a low level of retirements in this account, a comparison of

salvage and removal cost for account 352 was done since the equipment in both

accounts are similar. Because of the c hanges reflected in account 352 as well, a

proposed net salvage estimate of negative 10 percent is supported and

recommended for Account 361.

FERC Account 362 Distribution Substati on Equipment (Negative 15 percent)

The current net salvage estimate for th is account is negative 10 percent. In

the most recent period, a moving average of negative 15 percent exists for both the

5-year and 10-year bands. After examin ing Company history, a negative 15

# 68 percent net salvage estimate is recommended for this account.

FERC Account 364 Distribut ion Poles, Towers, a nd Fixtures (Negative 50

percent)

The current net salvage estimate for th is account is negative 25 percent. In

the most recent period, a moving average of negative 108 percent exists for both

the 5-year and 10-year bands. Although ot her utilities have appr oved levels of

negative net salvage in that range, such a si gnificant change w ould cause a drastic

increase in SPS’s depreciation expense for this account. To conservatively treat

net salvage, but move in the direction of the experience, a negative 50 percent net

salvage estimate is recommended which miti gates the increase in net salvage while

very conservatively modeling Company experience.

FERC Account 365 Distribution Overh ead Conductor and Devices (Negative

35 percent)

The current net salvage estimate for th is account is negative 20 percent. In

the most recent period, a moving av erage of negative 46 and negative 35 percent

exists for the 5-year and 10-year bands, re spectively. A negative 35 percent net

salvage estimate is recommended which models recent and long term Company

experience.

FERC Account 366 Distribution Underg round Conduit (Negative 20 percent)

The current net salvage estimate for this account is negative 10 percent. This

account has demonstrated erratic levels of net salvage. In the mo st recent period,

a moving average of negative 74 and negative 64 percent exis ts for the 5-year and

10-year bands, respectively. To model net salvage in the future a negative 20

percent net salvage estimate is retai ned for this account at this time.

FERC Account 367 Distribution Underground Conductor and Devices

(Negative 20 percent)

The currently approved net salvage esti mate for this account is negative 5

# 69 percent. This account has demonstrated errati c levels of net salvage. In the most

recent period, a moving average of negat ive 27 percent and negative 20 percent

exists for the 5-year and 10-year bands, res pectively. To model net salvage toward

the indications, a negative 20 percent estimate is recommended for this account.

FERC Account 368 Distribution Line Tr ansformers (Negative 10 percent)

The currently approved net salvage esti mate for this account is negative 5

percent. Line transformer gross salvage proceeds have become smaller, while

removal costs have risen. In the most re cent period, a moving average of negative

28 and negative 20 percent exists for the 5-year and 10-year bands, respectively.

Some erratic experience indicated si nce 2003, so we re commend limiting the

change to a negative 10 percent net salvage estimate for this account at this time.

FERC Account 369 Distribution Se rvices (Negative 40 percent)

The currently approved net salvage esti mate for this account is negative 40

percent. In the most recent period, a moving average of negative 39 percent and

45 percent exists for the 5-year and 10- year bands, respectively. A negative 40

percent net salvage is retained for this account.

FERC Account 370 Distribution Meters (Negative 10 percent)

The currently approved net salvage esti mate for this account is negative 5

percent. In the most recent period, a moving average of negative 6 and negative

10 percent exists for the 5-year and 10-year bands, respectively. To model net

salvage in the future, a negative 10 percent net salvage estimate is recommended

for this account.

FERC Account 371 Distribution Inst allation on Customers’ Premises

(Negative 20 percent)

The currently approved net salvage esti mate for this account is negative 15

percent. In the most recent period, a moving average of negative 46 percent and

# 70 negative 23 percent exists for the 5-year and 10-year intervals, respectively. Most

recent experience suggests more negative net salvage is occurring, but the 7-and

10-year moving averages indicate negative net salvage around 20 percent. Due to

the variation in the experience we recomme nd moving toward the indications of the

longer bands, a negative 20 percent net salvage for this account at this time.

FERC Account 373 Distribution Street Lighting (Negative 45 percent)

The currently approved net salvage esti mate for this account is negative 30

percent. Transactional history shows dimini shing positive salva ge for this account,

with a sharp increase in removal cost sinc e 2004. In the most recent period, a

moving average of negative 63 percent and negative 62 percent exists for the 5-

year and 10-year intervals, respectively. However, experience is somewhat erratic

so we recommend moving toward the more negative indications, but limiting the

change to a negative 45 percent net salvage for this account at this time.

# 71 Salvage – General Property

Most accounts in the general function cu rrently have a 0 percent net salvage

value. For general plant accounts 391-398, the Company will continue the use of

AR15 using the study recommended net salvage parameters. Detailed analysis

and results by account are shown in A ppendix E-2 and individual account results

are discussed below.

FERC Account 389 Land Rights (0 percent)

The currently approved net salvage estima te for this account is 0 percent.

Land rights generally have no salvage value at retirement and none is shown in the

analysis. A 0 percent net salvage estimate is recommended to be retained for this

account.

FERC Account 390 Structures and Improvements (negative 10 percent)

The currently approved net salvage estimate for this account is 0 percent.

This account consists of all general pl ant structures, which may range from

buildings to building components such as HVAC systems or roofs. In 2003, a

consolidation of facilities occurred which pr oduced a large positive salvage. This is

a one-time event related to merger activity and Company cost reduction initiatives.

This is not anticipated to recur. The most recent 5 and 10 year moving average

show negative 33 and 24 percent net salv age, respectively. This study

recommends moving toward the negative net salvage indications, but limiting it to a

negative 10 percent for this account.

FERC Account 391 Office Furniture and Equipment (0 percent)

This account consists of gro ss salvage and cost of removal for

miscellaneous office furniture such as desks, chairs, filing cabi nets, and tables used

for general utility service. The currently approved net salvage estimate for this

account is positive 2 percent. The av erage net salvage has been declining for the

last several years. The most recent 5 and 10 year moving averages show negative

# 72 15 percent and a positive 1 percent net sa lvage, respectively. To model net

salvage in the future, a 0 percent net sa lvage estimate is recommended for this

account.

FERC Account 391 Computer Equipment (0 percent)

This account consists of gross salv age and cost of removal for network

computer equipment used for general utility service. T he currently approved net

salvage estimate for this account is 0 per cent. Activity is only recorded since 2006

with some indication that some salvage and co st of removal are possible. Overall

indications are negligible. Therefore, reta ining a 0 percent net salvage estimate is

requested for this account.

FERC Account 392 Transportation Equipment (0 percent)

The currently approved net salvage estima te for this account is positive 20

percent. The Company has gone to a like kind exchange program for the last four

years and will continue this in the future. This study recommends moving to 0

percent net salvage estimate for this account.

FERC Account 393 Stores Equipment (0 percent)

This account consists of gross sa lvage and cost of removal for stores

equipment used for general utility service. The currently approved net salvage

estimate for this account is 0 percent. This kind of equipment seldom produces any

gross salvage. To model net salvage in the future, a 0 percent net salvage is

retained for this account.

FERC Account 394 Tools, Shop, and Garage Equipment (0 percent)

This account consists of gross salvage and cost of removal for various items

or tools used in shop and garages such as air compressors, grinders, mixers,

hoists, and cranes. The currently approved net salvage estimate for this account is

0 percent. Since 2007 only one year, 2012 has had any salvage. Most recent 5-

# 73 yer average is less than 1 percent. To model net salvage in the future, a 0 percent

net salvage estimate is retained.

FERC Account 395 Laboratory Equipment (0 percent)

This account consists of gross salv age and cost of removal for laboratory

equipment used in general utility service. The currently approved net salvage

estimate for this account is 0 percent. The most recent 5-year and 10-year net

salvage percentages are 3 per cent and 0 percent, respectively. To model net

salvage in the future, a 0 per cent net salvage estimate is retained for this account.

FERC Account 396 Power Operated Equipment (0 percent)

The currently approved net salvage estima te for this account is positive 10

percent. Proceeds for used power operat ed equipment have declined since 1998.

The average net salvage has been declining for the last several y ears. The most

recent 5-year and 10-year net salvage percentages are 0 percent and 5 percent,

respectively. To model net salvage in t he future, a 0 percent net salvage estimate

is recommended for this account.

FERC Account 397 Communication E quipment (negative 4 percent)

This account consists of gro ss salvage and cost of removal for

miscellaneous communication equipment used in general utility service. The

currently approved net salvage estimate for this account is 0 percent. The most

recent 5-year and 10-year net salvage per centage is negative 4 percent for both

bands. To model net salvage in the fu ture, a negative 4 percent net salvage

estimate is retained for this account.

FERC Account 397 Communication Equipm ent – EMS (negative 4 percent)

This account consists of gro ss salvage and cost of removal for

miscellaneous communication equipment used in general utility service. The

currently approved net salvage estimate for this account is 0 percent. Based on

other communication assets and activity, a negative 4 percent net salvage estimate

# 74 is recommended for this account.

FERC Account 398 Miscellaneous Equipment (0 percent)

This account consists of gro ss salvage and cost of removal for

miscellaneous equipment used in general utilit y service. The currently approved

net salvage estimate for this account is 0 percent. The most recent 5-year and 10-

year net salvage percentages are negativ e 2 percent and negative 8 percent,

respectively. Expectations are that sa lvage and cost of removal will offset each

other. To model net salvage in the futu re, a 0 percent net salvage estimate is

retained for this account.

# 75 APPENDIX A

Computation of Depreci ation Accrual RatesAppendix A-1Page 1 of 6AllocatedPlant Reserve Net NetAnnualFERC Balance Balance Salvage Salvage Unaccrued RemainingAnnualAccrualAccountDescription06/30/201306/30/2013%AmountBalanceLifeAccrual%(1)(2)(3)(4)(5)(6)(7)(8)E310 Land and Water RightsLand Rights NM73,07159,1570.00%-13,914 13.871,003 1.3732%Land Rights TX1,098,015419,7700.00%-678,245 21.2431,929 2.9079%Water Rights TX5,661,7221,972,2420.00%-3,689,480 25.93142,284 2.5131%Total/Composite6,832,8082,451,169-4,381,639175,2162.5643%E311 Structures and ImprovementsCunningham Unit 12,359,6892,096,194-5.00%(117,984)381,480 8.5844,485 1.8852%Cunningham Unit 21,724,2711,392,316-5.00%(86,214)418,169 11.4336,585 2.1218%Common Facilities5,704,4892,579,966-5.00%(285,224)3,409,748 11.83288,204 5.0522%Harrington Unit 16,898,3144,477,369-5.00%(344,916)2,765,861 21.13130,921 1.8979%Harrington Unit 25,489,4253,157,326-5.00%(274,471)2,606,570 23.02113,229 2.0627%Harrington Unit 38,990,2395,193,906-5.00%(449,512)4,245,845 24.56172,844 1.9226%Common Facilities25,059,4819,201,425-5.00% (1,252,974)17,111,030 25.68666,405 2.6593%Jones Unit 14,397,3032,962,406-5.00%(219,865)1,654,762 16.9797,519 2.2177%Jones Unit 21,848,2541,274,260-5.00%(92,413)666,407 19.3734,408 1.8616%Common Facilities7,679,9371,940,407-5.00%(383,997)6,123,527 40.72150,378 1.9581%Maddox3,802,3972,065,155-5.00%(190,120)1,927,362 16.30118,251 3.1099%Moore County2,234,6062,346,337-5.00%(111,730)0 0.000 0.0000%Nichols Unit 11,863,5171,672,675-5.00%(93,176)284,018 6.7941,834 2.2449%Nichols Unit 21,108,535924,420-5.00%(55,427)239,542 9.5825,005 2.2557%Nichols Unit 31,583,1611,118,756-5.00%(79,158)543,562 15.8934,214 2.1611%Common Facilities48,229,14919,922,156-5.00% (2,411,457)30,718,451 16.631,847,708 3.8311%Plant X Unit 11,262,9831,171,185-5.00%(63,149)154,947 5.7826,786 2.1208%Plant X Unit 21,021,771849,541-5.00%(51,089)223,319 5.7738,674 3.7850%Plant X Unit 31,026,455957,088-5.00%(51,323)120,690 7.7115,644 1.5241%Plant X Unit 41,171,925908,458-5.00%(58,596)322,063 13.1424,513 2.0917%Common Facilities7,278,0354,175,500-5.00%(363,902)3,466,437 13.68253,3693.4813%Tolk 131,757,35717,822,047-5.00%(1,587,868)15,523,177 24.85624,795 1.9674%Tolk 218,065,1919,640,499-5.00%(903,260)9,327,951 26.60350,692 1.9413%Common Facilities25,475,8234,797,721-5.00% (1,273,791)21,951,893 27.89787,028 3.0893%Total/Composite216,032,307102,647,112(10,801,615)124,186,8105,923,4902.7419%E312 Boiler Plant EquipmentCunningham Unit 18,036,2954,494,342-5.00%(401,815)3,943,768 8.60458,800 5.7091%Cunningham Unit 215,745,1968,367,136-5.00%(787,260)8,165,320 11.32721,270 4.5809%Common Facilities5,989,9332,813,333-5.00%(299,497)3,476,097 11.76295,597 4.9349%Southwestern Public Service CompanyTexasComputation of Depreciation Accrual RatesJune 30, 2013Appendix A-1Page 2 of 6AllocatedPlant Reserve Net NetAnnualFERC Balance Balance Salvage Salvage Unaccrued RemainingAnnualAccrualAccountDescription06/30/201306/30/2013%AmountBalanceLifeAccrual%(1)(2)(3)(4)(5)(6)(7)(8)Southwestern Public Service CompanyTexasComputation of Depreciation Accrual RatesJune 30, 2013Harrington Unit 198,674,41846,468,053-5.00% (4,933,721)57,140,086 20.61 2,773,030 2.8103%Harrington Unit 2 101,317,20849,787,206-5.00% (5,065,860)56,595,862 22.002,572,304 2.5389%Harrington Unit 3109,586,50555,359,875-5.00% (5,479,325)59,705,955 23.312,560,973 2.3369%Common Facilities11,969,7324,995,493-5.00%(598,487)7,572,726 24.49309,259 2.5837%Jones Unit 115,098,0369,844,241-5.00%(754,902)6,008,697 15.97376,232 2.4919%Jones Unit 215,414,7978,805,887-5.00%(770,740)7,379,650 18.40400,991 2.6013%Common Facilities12,389,6452,824,888-5.00%(619,482)10,184,240 37.98268,139 2.1642%Maddox16,854,3217,210,308-5.00%(842,716)10,486,729 15.90659,505 3.9130%Moore County6,956,5597,304,387-5.00%(347,828)0 0.000 0.0000%Nichols Unit 110,768,3807,463,943-5.00%(538,419)3,842,856 6.83562,760 5.2260%Nichols Unit 211,453,7307,034,612-5.00%(572,686)4,991,804 9.54523,333 4.5691%Nichols Unit 319,283,46010,884,899-5.00%(964,173)9,362,735 15.59600,665 3.1149%Common Facilities5,429,4332,610,580-5.00%(271,472)3,090,325 16.29189,704 3.4940%Plant X Unit 16,139,9535,195,337-5.00%(306,998)1,251,614 5.74217,972 3.5501%Plant X Unit 215,924,80412,361,067-5.00%(796,240)4,359,977 5.82749,485 4.7064%Plant X Unit 38,311,3386,266,708-5.00%(415,567)2,460,197 7.55325,813 3.9201%Plant X Unit 417,623,17710,607,032-5.00%(881,159)7,897,304 13.04605,501 3.4358%Common Facilities2,393,7511,425,591-5.00%(119,688)1,087,847 13.5180,507 3.3632%Tolk 1185,312,55592,504,741-5.00% (9,265,628)102,073,443 23.424,358,528 2.3520%Tolk 2207,358,40298,713,573-5.00% (10,367,920)119,012,750 25.124,737,477 2.2847%Common Facilities12,953,5055,502,394-5.00%(647,675)8,098,787 25.59316,435 2.4429%Total/Composite920,985,134468,845,624(46,049,257)498,188,76724,664,2802.6780%E314 TurbogeneratorsCunningham Unit 16,208,8524,504,092-5.00%(310,443)2,015,203 8.66232,708 3.7480%Cunningham Unit 210,776,7097,183,315-5.00%(538,835)4,132,229 11.48359,959 3.3402%Common Facilities110,76472,827-5.00%(5,538)43,474 11.663,727 3.3652%Harrington Unit 132,751,53317,837,081-5.00% (1,637,577)16,552,029 21.21780,5282.3832%Harrington Unit 234,045,30918,268,645-5.00%(1,702,265)17,478,929 22.87764,376 2.2452%Harrington Unit 346,541,94622,360,193-5.00% (2,327,097)26,508,851 24.671,074,447 2.3086%Common Facilities2,945,0081,196,196-5.00%(147,250)1,896,063 25.1675,368 2.5592%Jones Unit 114,282,4129,629,025-5.00%(714,121)5,367,508 16.70321,469 2.2508%Jones Unit 216,040,0489,166,745-5.00%(802,002)7,675,305 19.40395,702 2.4670%Common Facilities7,752,7722,465,602-5.00%(387,639)5,674,809 38.89145,929 1.8823%Maddox10,947,0045,612,349-5.00%(547,350)5,882,005 16.01367,407 3.3562%Moore County4,116,2894,322,103-5.00%(205,814)0 0.000 0.0000%Nichols Unit 19,687,1177,563,513-5.00%(484,356)2,607,960 6.78384,377 3.9679%Nichols Unit 29,701,2967,194,152-5.00%(485,065)2,992,210 9.59312,071 3.2168%Nichols Unit 316,874,85210,820,221-5.00%(843,743)6,898,374 15.95432,436 2.5626%Appendix A-1Page 3 of 6AllocatedPlant Reserve Net NetAnnualFERC Balance Balance Salvage Salvage Unaccrued RemainingAnnualAccrualAccountDescription06/30/201306/30/2013%AmountBalanceLifeAccrual%(1)(2)(3)(4)(5)(6)(7)(8)Southwestern Public Service CompanyTexasComputation of Depreciation Accrual RatesJune 30, 2013Common Facilities3,255,0921,639,191-5.00%(162,755)1,778,655 16.36108,691 3.3391%Plant X Unit 14,616,9974,250,785-5.00%(230,850)597,063 5.83102,445 2.2189%Plant X Unit 26,735,0265,830,474-5.00%(336,751)1,241,303 5.85212,348 3.1529%Plant X Unit 37,717,5425,906,298-5.00%(385,877)2,197,122 7.72284,562 3.6872%Plant X Unit 412,651,0577,761,564-5.00%(632,553)5,522,046 13.29415,529 3.2845%Common Facilities1,411,239647,318-3.00%(42,337)806,258 13.5959,325 4.2037%Tolk 174,983,13541,224,499-5.00% (3,749,157)37,507,794 24.461,533,138 2.0446%Tolk 2100,862,24149,700,654-5.00% (5,043,112)56,204,699 24.672,278,334 2.2589%Common Facilities12,318,6872,956,601-5.00%(615,934)9,978,020 27.46363,341 2.9495%Total/Composite447,332,927248,113,444(22,338,422)221,557,90511,008,2182.4609%E315 Accessory Electric EquipmentCunningham Unit 1870,854585,405-5.00%(43,543)328,992 8.3439,460 4.5312%Cunningham Unit 25,287,3742,141,924-5.00%(264,369)3,409,819 11.89286,885 5.4259%Common Facilities783,399528,760-5.00%(39,170)293,808 11.6025,322 3.2324%Harrington Unit 17,196,9393,930,357-5.00%(359,847)3,626,429 20.04180,950 2.5143%Harrington Unit 24,984,2622,709,239-5.00%(249,213)2,524,236 21.52117,284 2.3531%Harrington Unit 34,886,0742,944,207-5.00%(244,304)2,186,171 22.3597,820 2.0020%Common Facilities500,287223,202-5.00%(25,014)302,099 25.1612,006 2.3999%Jones Unit 11,245,589792,958-5.00%(62,279)514,910 15.9232,336 2.5961%Jones Unit 21,818,208762,854-5.00%(90,910)1,146,264 19.1759,806 3.2893%Common Facilities2,395,339407,547-5.00%(119,767)2,107,559 40.4452,122 2.1760%Maddox6,587,5072,136,011-5.00%(329,375)4,780,871 16.61287,858 4.3698%Moore County502,038527,140-5.00%(25,102)0 0.000 0.0000%Nichols Unit 12,051,3351,544,081-5.00%(102,567)609,821 6.7690,211 4.3977%Nichols Unit 21,038,609724,519-5.00%(51,930)366,020 9.3039,373 3.7909%Nichols Unit 31,567,5041,119,744-5.00%(78,375)526,135 14.4736,351 2.3190%Common Facilities2,243,228981,022-5.00%(112,161)1,374,367 16.4283,7263.7324%Plant X Unit 1612,697421,034-5.00%(30,635)222,297 5.7538,665 6.3107%Plant X Unit 2613,416576,181-5.00%(30,671)67,905 5.5712,194 1.9879%Plant X Unit 3976,256627,984-5.00%(48,813)397,085 7.8850,415 5.1642%Plant X Unit 41,813,6281,107,849-5.00%(90,681)796,460 13.0161,204 3.3747%Common Facilities124,53457,454-5.00%(6,227)73,307 13.875,287 4.2450%Tolk 115,215,1679,017,588-5.00%(760,758)6,958,338 22.73306,080 2.0117%Tolk 29,514,4685,229,550-5.00%(475,723)4,760,641 24.60193,554 2.0343%Total/Composite72,828,70939,096,609(3,641,435)37,373,5352,108,9092.8957%E316 Miscellaneous Power Plant EquipmentCunningham Unit 165,28025,231-5.00%(3,264)43,314 8.844,901 7.5071%Cunningham Unit 289,97138,773-5.00%(4,499)55,696 11.604,802 5.3370%Appendix A-1Page 4 of 6AllocatedPlant Reserve Net NetAnnualFERC Balance Balance Salvage Salvage Unaccrued RemainingAnnualAccrualAccountDescription06/30/201306/30/2013%AmountBalanceLifeAccrual%(1)(2)(3)(4)(5)(6)(7)(8)Southwestern Public Service CompanyTexasComputation of Depreciation Accrual RatesJune 30, 2013Common Facilities1,488,4771,047,530-5.00%(74,424)515,371 11.2145,990 3.0897%Harrington Unit 1966,993542,815-5.00%(48,350)472,527 19.5524,173 2.4998%Harrington Unit 21,511,634920,344-5.00%(75,582)666,873 20.4232,655 2.1602%Harrington Unit 31,863,1061,010,612-5.00%(93,155)945,650 22.1042,797 2.2971%Common Facilities2,629,3241,289,032-5.00%(131,466)1,471,758 22.7764,641 2.4585%Jones Unit 1756,086562,057-5.00%(37,804)231,833 15.2515,200 2.0104%Jones Unit 2630,194422,717-5.00%(31,510)238,986 17.5313,636 2.1638%Common Facilities3,232,5311,073,340-5.00%(161,627)2,320,817 33.6169,055 2.1362%Maddox906,065418,704-5.00%(45,303)532,664 15.8033,721 3.7217%Moore County125,788132,077-5.00%(6,289)0 0.000 0.0000%Nichols Unit 1269,204191,479-5.00%(13,460)91,185 6.7413,521 5.0225%Nichols Unit 279,41471,412-5.00%(3,971)11,972 9.001,331 1.6758%Nichols Unit 3310,212163,785-5.00%(15,511)161,937 15.3910,520 3.3912%Common Facilities2,358,5091,321,895-5.00%(117,925)1,154,540 15.5574,255 3.1484%Plant X Unit 1--5.00%-0Plant X Unit 252,89041,773-5.00%(2,644)13,762 5.882,341 4.4266%Plant X Unit 3977,798720,291-5.00%(48,890)306,397 7.7639,496 4.0393%Plant X Unit 4130,50060,136-5.00%(6,525)76,889 13.365,757 4.4113%Common Facilities1,528,753878,232-5.00%(76,438)726,959 12.9855,991 3.6626%Tolk 1721,430371,118-5.00%(36,072)386,384 22.4417,219 2.3868%Tolk 23,513,5361,903,669-5.00%(175,677)1,785,544 23.4576,150 2.1673%Common Facilities7,205,1983,391,785-5.00%(360,260)4,173,672 24.02173,792 2.4120%Total/Composite31,412,89116,598,805(1,570,645)16,384,730821,9442.6166%Total Steam Production1,695,424,777877,752,765(84,401,374)902,073,38644,702,0582.6366%E340 Land and Water RightsLand Rights TX - Riverview6766760.00%--0.00-0.0000%Total/Composite676675.80---0.0000%E341 Structures and ImprovementsCarlsbad240,088229,297-5.00%(12,004)22,79612.501,824 0.7596%Cunningham492,893194,539-5.00%(24,645)322,999 27.5011,745 2.3829%Jones Unit 34,754,439266,021-5.00%(237,722)4,726,141 43.50108,647 2.2852%Jones Unit 45,039,73435,055-5.00%(251,987)5,256,666 45.50115,531 2.2924%Maddox1,602,8561,305,322-5.00%(80,143)377,677 7.5050,357 3.1417%Quay County869,07512,157-5.00%(43,454)900,373 22.5040,017 4.6045%Riverview--Total/Composite12,999,0872,042,391(649,954)11,606,651328,1212.5242%E342 Fuel Holders and Accessory EquipmentAppendix A-1Page 5 of 6AllocatedPlant Reserve Net NetAnnualFERC Balance Balance Salvage Salvage Unaccrued RemainingAnnualAccrualAccountDescription06/30/201306/30/2013%AmountBalanceLifeAccrual%(1)(2)(3)(4)(5)(6)(7)(8)Southwestern Public Service CompanyTexasComputation of Depreciation Accrual RatesJune 30, 2013Blackhawk3,598,1142,370,685-5.00%(179,906)1,407,334 11.50122,377 3.4011%Cunningham1,211,937283,330-5.00%(60,597)989,203 27.5035,971 2.9681%Jones Unit 3---5.00%-0 0.000Jones Unit 4--5.00%-00Maddox512,886512,224-5.00%(25,644)26,307 7.503,508 0.6839%Quay County1,575617-5.00% (79)1,037 22.5046 2.9259%Riverview---5.00%-0Total/Composite5,324,5123,166,856(266,226)2,423,881161,9023.0407%E343 Prime MoversCarlsbad2,265,3931,574,984-5.00%(113,270)803,678 12.5064,294 2.8381%Cunningham51,683,64722,160,251-5.00% (2,584,182)32,107,579 27.501,167,548 2.2590%Jones Unit 3---5.00%-0 0.000Jones Unit 4-5.00%-00Quay County4,620,1553,235,884-5.00% (231,008)1,615,279 22.50 71,790 1.5538%Total/Composite 58,569,19626,971,119(2,928,460)34,526,5361,303,6332.2258%E344 GeneratorsCarlsbad409,729335,042-5.00%(20,486)95,173 12.507,614 1.8583%Cunningham3,108,157830,715-5.00%(155,408)2,432,850 27.5088,467 2.8463%Jones Unit 366,307,9693,710,067-5.00% (3,315,398)65,913,300 43.501,515,248 2.2852%Jones Unit 464,441,989448,245-5.00% (3,222,099)67,215,844 45.501,477,271 2.2924%Maddox15,142,40914,290,257-5.00%(757,120)1,609,272 7.50214,570 1.4170%Quay County16,514,3301,184,984-5.00% (825,716)16,155,062 22.50718,003 4.3478%Riverview---5.00%-0Total/Composite165,924,58220,799,310(8,296,229)153,421,5014,021,1732.4235%E345 Accessory Electric EquipmentCarlsbad239,463222,945-5.00%(11,973)28,491 12.502,279 0.9518%Cunningham5,882,5842,223,348-5.00%(294,129)3,953,365 27.50143,759 2.4438%Jones Unit 310,412,594582,606-5.00%(520,630)10,350,618 43.50237,945 2.2852%Jones Unit 49,809,38068,232-5.00%(490,469)10,231,617 45.50224,871 2.2924%Maddox1,372,8591,087,705-5.00%(68,643)353,798 7.5047,173 3.4361%Quay County2,728,668379,772-5.00% (136,433)2,485,330 22.50 110,459 4.0481%Riverview -Total/Composite 30,445,5484,564,607(1,522,277)27,403,218766,4862.5176%E346 Miscellaneous Power Plant EquipmentCarlsbad2,3982,253-5.00%(120)265 12.5021 0.8830%Cunningham1,183,177287,625-5.00%(59,159)954,711 27.5034,717 2.9342%Jones Unit 31,594,02089,189-5.00%(79,701)1,584,533 43.5036,426 2.2852%Jones Unit 41,013,9427,053-5.00%(50,697)1,057,587 45.5023,244 2.2924%Maddox86,48685,258-5.00%(4,324)5,552 7.50740 0.8559%Quay County611,04967,269-5.00% (30,552)574,332 22.50 25,526 4.1774%Appendix A-1Page 6 of 6AllocatedPlant Reserve Net NetAnnualFERC Balance Balance Salvage Salvage Unaccrued RemainingAnnualAccrualAccountDescription06/30/201306/30/2013%AmountBalanceLifeAccrual%(1)(2)(3)(4)(5)(6)(7)(8)Southwestern Public Service CompanyTexasComputation of Depreciation Accrual RatesJune 30, 2013Riverview--Total/Composite4,491,071538,646(224,554)4,176,979120,6742.6870%#DIV/0!Total Other Production277,754,67258,083,605(13,887,700)233,558,7666,701,9882.4129%Total Production1,973,179,448935,836,370(98,289,073)1,135,632,15251,404,0462.6051%Transmission350 Land Rights62,564,0248,034,857.73 0.00%-54,529,166 69.58783,733 1.2527%352 Structures & Improvements41,772,49113,130,071.38 -15.00% (6,265,874)34,908,293 46.97743,126 1.7790%353 Station Equipment519,493,078114,682,753.83 -19.00% (98,703,685)503,514,009 46.27 10,881,681 2.0947%354 Towers & Fixtures8,263,8252,267,895.93 -5.00%(413,191)6,409,120 55.11116,293 1.4073%355 Poles & Fixtures502,260,235130,952,433.31 -60.00% (301,356,141)672,663,942 45.07 14,924,131 2.9714%356 Overhead Conductors & Devices223,715,14170,615,141.27 -30.00% (67,114,542)220,214,541 36.935,963,170 2.6655%357 Underground Conduit255,073134,274.36 0.00%-120,799 34.943,457 1.3553%358 Underground Conductor & Devices489,717234,266.69 0.00%-255,450 23.1611,030 2.2523%Total Transmission1,358,813,583340,051,694.51(473,853,433)1,492,615,32233,426,6232.4600%Distribution Texas Only360 Land Rights1,719,148456,071.62 0.00%-1,263,076 45.3127,879 1.6217%361 Structures & Improvements4,921,7831,437,879.28 -10.00%(492,178)3,976,082 45.2987,794 1.7838%362 Station Equipment98,948,65027,684,422.32 -15.00% (14,842,298)86,106,526 42.652,019,058 2.0405%364 Poles, Towers & Fixtures139,455,23245,925,302.97 -50.00% (69,727,616)163,257,545 41.463,937,655 2.8236%365 Overhead Conductors & Devices132,658,66637,525,087.65 -35.00% (46,430,533)141,564,111 37.913,734,366 2.8150%366 Underground Conduit16,425,0036,036,346.40 -20.00% (3,285,001)13,673,658 43.04317,725 1.9344%367 Underground Conductor & Devices23,183,0477,294,361.43 -20.00% (4,636,609)20,525,295 35.62576,177 2.4853%368 Line Transformers140,143,33239,220,753.44 -10.00% (14,014,333)114,936,911 34.433,338,220 2.3820%369 Services49,206,24522,086,238.70 -40.00% (19,682,498)46,802,504 30.981,510,882 3.0705%370 Meters47,999,17819,955,030.88 -10.00% (4,799,918)32,844,064 26.041,261,121 2.6274%371 Installations on Customers' Premises8,129,4804,624,035.88 -20.00% (1,625,896)5,131,340 14.06364,956 4.4893%373 Street Lighting & Signal Systems12,872,7416,172,460.19 -45.00% (5,792,733)12,493,014 28.48438,608 3.4073%Total Distribution Texas Only675,662,504218,417,990.78(185,329,613)642,574,12617,614,4412.6070%General389 Land Rights45,9674,928.13 0.00%-41,039 31.251,313 2.8572%390 Structures & Improvements61,238,2586,025,340.16 -10.00% (6,123,826)61,336,744 36.761,668,388 2.7244%Total General61,284,2266,030,268.29(6,123,826)61,377,7831,669,7012.7245%Total Depreciable Plant4,068,939,7611,500,336,323.60(763,595,945)3,332,199,383104,114,8102.5588%Appendix A-2Page 1 of 1PlantAllocated TheoreticalAmortizeBalance ReserveReserveReserveRemaining ReserveDescription06/30/201306/30/201306/30/2013DifferenceLifeDifference391 Office Furniture & Equipment10,313,040$4,468,657$6,345,727$(1,877,070)$17.04110,138$391 Computer Equipment19,504,7563,823,8768,836,868(5,012,992)2.94 1,703,829392 Transportation Equipment68,567,86643,048,45353,020,190(9,971,737)7.79 1,279,688393 Stores Equipment460,265204,051 351,687(147,636)15.969,252394 Tools, Shop & Garage Equipment20,153,1661,829,8724,764,137(2,934,265)27.56106,456395 LaboratoryEquipment10,736,8756,634,2259,949,679(3,315,453)10.35320,190396 Power Operated Equipment9,818,9552,959,7704,215,993(1,256,223)14.2288,336397 Communication Equipment53,630,06428,498,53043,367,205(14,868,675)11.07 1,343,472397 Communication Equipment - EMS3,300,45798,798323,416(224,618)20.8310,782398 Miscellaneous Equipment2,823,585861,8741,640,409(778,535)13.5157,641Total General Amortized199,309,02892,428,107132,815,312(40,387,205)5,029,783Excluding Fully Accrued AssetsPlantAllocatedAccrualBalance ReserveAmortizationAmortization Annual For ReserveTotalAmortizationAccountDescription06/30/201306/30/2013Life Net Salvage%Amortization DifferenceAmortization Rate391 Office Furniture & Equipment8,491,5252,729,35825.000% 339,661 110,138449,7995.2970%391 Computer Equipment18,695,2953,233,9885.000% 3,739,0591,703,8295,442,88829.1137%392 Transportation Equipment49,236,66324,154,02111.000% 4,476,0601,279,6885,755,74911.6900%393 Stores Equipment390,707140,96135.000%11,1639,25220,4155.2251%394 Tools, Shop & Garage Equipment19,883,5441,688,77535.000% 568,101 106,456674,5573.3925%395 LaboratoryEquipment8,148,9104,191,48025.000% 325,956320,190646,1467.9292%396 Power Operated Equipment8,615,3431,811,18218.000% 478,63088,336566,9666.5809%397 Communication Equipment43,749,19217,505,04323.00-4% 1,978,2241,343,4723,321,6967.5926%397 Communication Equipment - EMS3,300,457104,45823.00-4% 149,23810,782160,0204.8484%398 Miscellaneous Equipment2,563,867636,25624.000% 106,82857,641164,4686.4149%Total General Amortized163,075,503$56,195,522$12,172,921$5,029,783$17,202,705$Southwestern Public Service CompanyTexasComputation of Annual Amortization RateJune 30, 2013

# 83 APPENDIX B

Comparison of Approved vs Proposed Accrual RatesAppendix BPage 1 of 7PlantApproved (1)Depreciation Proposed Depreciation DepreciationBalanceAccrualAccrualAccrualAccrualAccrualAccountDescription41455.00Rates Note Approved RatesRatesProposedDifferenceE310 Land and Water RightsLand Rights NM 73,071 1.7900 % 1,3081.3732% 1,003 (305)0Land Rights TX 1,098,015 3.4300 % 37,6622.9079% 31,929 (5,733)0Water Rights TX 5,661,722 2.4100 % 136,4482.5131% 142,284 5,836Total/Composite 6,832,808 2.5673 % 175,4172.5643% 175,216 (201)E311 Structures and ImprovementsCunningham Unit 1 2,359,689 - %-1.8852%44,48544,485Cunningham Unit 21,724,2710.0800 %1,3792.1218%36,58535,205Common Facilities5,704,4893.4600 %197,3755.0522%288,20490,8280Harrington Unit 16,898,3140.6300 %43,4591.8979%130,92187,462Harrington Unit 25,489,4250.7800 %42,8182.0627%113,22970,412Harrington Unit 38,990,2390.7400 %66,5281.9226%172,844106,316Common Facilities25,059,4812.0000 %501,1902.6593%666,405165,2160Jones Unit 14,397,3031.0200 %44,8522.2177%97,51952,666Jones Unit 21,848,2540.4900 %9,0561.8616%34,40825,351Common Facilities7,679,9372.7500 %211,1981.9581%150,378(60,820)0Maddox3,802,3971.5500 %58,9373.1099%118,25159,3130Moore County2,234,6067.6600 %171,1710.0000%0(171,171)0Nichols Unit 11,863,517- %-2.2449%41,83441,834Nichols Unit 21,108,535- %-2.2557%25,00525,005Nichols Unit 31,583,161- %-2.1611%34,21434,214Common Facilites48,229,1493.5700 %1,721,7813.8311%1,847,708125,9280Plant X Unit 11,262,983- %-2.1208%26,78626,786Plant X Unit 21,021,771- %-3.7850%38,67438,674Plant X Unit 31,026,455- %-1.5241%15,64415,644Plant X Unit 41,171,925- %-2.0917%24,51324,513Common Facilities7,278,0352.4700 %179,7673.4813%253,36973,6010Tolk 131,757,3570.9800 %311,2221.9674%624,795313,573Tolk 218,065,1910.9000 %162,5871.9413%350,692188,105Common Facilities25,475,8232.2500 %573,2063.0893%787,028213,822Total/Composite216,032,3071.9888 %4,296,5272.7419%5,923,4901,626,963Southwestern Public Service CompanyTexasComparison Of Approved vs. Proposed Accrual RatesJune 30, 2013Appendix BPage 2 of 7PlantApproved (1)Depreciation Proposed Depreciation DepreciationBalanceAccrualAccrualAccrualAccrualAccrualAccountDescription41455.00Rates Note Approved RatesRatesProposedDifferenceSouthwestern Public Service CompanyTexasComparison Of Approved vs. Proposed Accrual RatesJune 30, 2013E312 Boiler Plant EquipmentCunningham Unit 1 8,036,295 1.2100 % 97,2395.7091% 458,800 361,561Cunningham Unit 2 15,745,196 0.6200 % 97,6204.5809% 721,270 623,650Common Facilities 5,989,933 4.5000 % 269,5474.9349% 295,597 26,0500Harrington Unit 1 98,674,418 1.3100 % 1,292,6352.8103% 2,773,030 1,480,395Harrington Unit 2 101,317,208 1.1500 % 1,165,1482.5389% 2,572,304 1,407,156Harrington Unit 3 109,586,505 1.2200 % 1,336,9552.3369% 2,560,973 1,224,017Common Facilities 11,969,732 2.0500 % 245,3802.5837% 309,259 63,8800Jones Unit 1 15,098,036 1.0500 % 158,5292.4919% 376,232 217,702Jones Unit 2 15,414,797 0.6400 % 98,6552.6013% 400,991 302,336Common Facilities 12,389,645 2.3900 % 296,1132.1642% 268,139 (27,974)0Maddox 16,854,321 1.4700 % 247,7593.9130% 659,505 411,7470Moore County6,956,5594.9800 %346,4370.0000%0(346,437)0Nichols Unit 110,768,3804.0400 %435,0435.2260%562,760127,718Nichols Unit 211,453,7303.1500 %360,7924.5691%523,333162,541Nichols Unit 319,283,4600.6700 %129,1993.1149%600,665471,466Common Facilites5,429,4332.4400 %132,4783.4940%189,70457,2260Plant X Unit 16,139,9535.2700 %323,5763.5501%217,972(105,604)Plant X Unit 215,924,8045.4100 %861,5324.7064%749,485(112,047)Plant X Unit 38,311,3381.7800 %147,9423.9201%325,813177,871Plant X Unit 417,623,1771.8400 %324,2663.4358%605,501281,234Common Facilities2,393,7512.6800 %64,1533.3632%80,50716,3550Tolk 1185,312,5550.8400 %1,556,6252.3520%4,358,5282,801,902Tolk 2207,358,4020.9700 %2,011,3772.2847%4,737,4772,726,101Common Facilities12,953,5051.3800 %178,7582.4429%316,435137,676Total/Composite920,985,1341.3223 %12,177,7572.6780% 24,664,28012,486,524E314 TurbogeneratorsCunningham Unit 16,208,8521.7700 %109,8973.7480%232,708122,811Cunningham Unit 210,776,7090.8904 %95,9563.3402%359,959264,004Common Facilities110,7641.9500 %2,1603.3652%3,7271,5670Harrington Unit 132,751,5331.1600 %379,9182.3832%780,528400,610Harrington Unit 234,045,3091.0300 %350,6672.2452%764,376413,709Harrington Unit 346,541,9461.1900 %553,8492.3086%1,074,447520,598Common Facilities2,945,0081.8000 %53,0102.5592%75,36822,3580Appendix BPage 3 of 7PlantApproved (1)Depreciation Proposed Depreciation DepreciationBalanceAccrualAccrualAccrualAccrualAccrualAccountDescription41455.00Rates Note Approved RatesRatesProposedDifferenceSouthwestern Public Service CompanyTexasComparison Of Approved vs. Proposed Accrual RatesJune 30, 2013Jones Unit 114,282,4120.2400 %34,2782.2508%321,469287,191Jones Unit 216,040,0480.5600 %89,8242.4670%395,702305,878Common Facilities7,752,7722.3100 %179,0891.8823%145,929(33,160)0Maddox10,947,0040.8900 %97,4283.3562%367,407269,9790Moore County4,116,2896.9000 %284,0240.0000%0(284,024)0Nichols Unit 19,687,1170.2300 %22,2803.9679%384,377362,097Nichols Unit 29,701,2960.4800 %46,5663.2168%312,071265,505Nichols Unit 316,874,8520.8200 %138,3742.5626%432,436294,063Common Facilites3,255,0922.6800 %87,2363.3391%108,69121,4550Plant X Unit 14,616,997- %-2.2189%102,445102,445Plant X Unit 26,735,0261.0600 %71,3913.1529%212,348140,957Plant X Unit 37,717,542- %-3.6872%284,562284,562Plant X Unit 412,651,0570.9800 %123,9803.2845%415,529291,548Common Facilities1,411,2390.7000 %9,8794.2037%59,32549,4460Tolk 174,983,1350.8500 %637,3572.0446%1,533,138895,782Tolk 2100,862,2410.9500 %958,1912.2589%2,278,3341,320,143Common Facilities12,318,6872.1000 %258,6922.9495%363,341104,649Total/Composite447,332,9271.0248 %4,584,0472.4609% 11,008,2186,424,171E315 Accessory Electric EquipmentCunningham Unit 1870,85421.0800 %183,5764.5312%39,460(144,116)Cunningham Unit 25,287,3740.7800 %41,2425.4259%286,885245,643Common Facilities783,3993.0500 %23,8943.2324%25,3221,4290Harrington Unit 17,196,9390.9600 %69,0912.5143%180,950111,859Harrington Unit 24,984,2621.0400 %51,8362.3531%117,28465,448Harrington Unit 34,886,0740.8900 %43,4862.0020%97,82054,334Common Facilities500,2872.0700 %10,3562.3999%12,0061,6500Jones Unit 11,245,5890.5200 %6,4772.5961%32,33625,859Jones Unit 21,818,2080.1700 %3,0913.2893%59,80656,715Common Facilities2,395,3392.7500 %65,8722.1760%52,122(13,750)0Maddox6,587,5071.0200 %67,1934.3698%287,858220,6660Moore County502,0384.2200 %21,1860.0000%0(21,186)0Nichols Unit 12,051,3353.5800 %73,4384.3977%90,21116,773Nichols Unit 21,038,609- %-3.7909%39,37339,373Nichols Unit 31,567,504- %-2.3190%36,35136,351Appendix BPage 4 of 7PlantApproved (1)Depreciation Proposed Depreciation DepreciationBalanceAccrualAccrualAccrualAccrualAccrualAccountDescription41455.00Rates Note Approved RatesRatesProposedDifferenceSouthwestern Public Service CompanyTexasComparison Of Approved vs. Proposed Accrual RatesJune 30, 2013Common Facilites2,243,2282.8000 %62,8103.7324%83,72620,9150Plant X Unit 1612,697- %-6.3107%38,66538,665Plant X Unit 2613,416- %-1.9879%12,19412,194Plant X Unit 3976,256- %-5.1642%50,41550,415Plant X Unit 41,813,6280.6100 %11,0633.3747%61,20450,141Common Facilities124,5341.1700 %1,4574.2450%5,2873,8290Tolk 115,215,1670.7900 %120,2002.0117%306,080185,881Tolk 29,514,4680.8400 %79,9222.0343%193,554113,632Total/Composite72,828,7091.2855 %936,1882.8957%2,108,9091,172,721E316 Miscellaneous Power Plant EquipmentCunningham Unit 165,280- %-7.5071%4,9014,901Cunningham Unit 289,9714.2600 %3,8335.3370%4,802969Common Facilities1,488,4771.2600 %18,7553.0897%45,99027,2350Harrington Unit 1966,9931.5600 %15,0852.4998%24,1739,088Harrington Unit 21,511,6340.4600 %6,9542.1602%32,65525,701Harrington Unit 31,863,1061.0000 %18,6312.2971%42,79724,166Common Facilities2,629,3241.4200 %37,3362.4585%64,64127,3050Jones Unit 1756,086- %-2.0104%15,20015,200Jones Unit 2630,1940.0100 %632.1638%13,63613,573Common Facilities3,232,5311.4000 %45,2552.1362%69,05523,7990Maddox906,0652.3400 %21,2023.7217%33,72112,5190Moore County125,7881.3700 %1,7230.0000%0(1,723)0Nichols Unit 1269,2040.9500 %2,5575.0225%13,52110,963Nichols Unit 279,414- %-1.6758%1,3311,331Nichols Unit 3310,2120.4100 %1,2723.3912%10,5209,248Common Facilites2,358,5091.3900 %32,7833.1484%74,25541,4720Plant X Unit 10Plant X Unit 252,8909.1500 %4,8394.4266%2,341(2,498)Plant X Unit 3977,7984.7800 %46,7394.0393%39,496(7,242)Plant X Unit 4130,5004.3900 %5,7294.4113%5,75728Common Facilities1,528,7531.4400 %22,0143.6626%55,99133,9770Tolk 1721,4300.9400 %6,7812.3868%17,21910,438Tolk 23,513,5360.8000 %28,1082.1673%76,15048,041Common Facilities7,205,1981.3300 %95,8292.4120%173,79277,963-0Appendix BPage 5 of 7PlantApproved (1)Depreciation Proposed Depreciation DepreciationBalanceAccrualAccrualAccrualAccrualAccrualAccountDescription41455.00Rates Note Approved RatesRatesProposedDifferenceSouthwestern Public Service CompanyTexasComparison Of Approved vs. Proposed Accrual RatesJune 30, 2013Total/Composite31,412,8911.3227 %415,4902.6166%821,944406,454Total Steam Production1,695,424,7771.3321 %22,585,4262.6366% 44,702,05822,116,632E340 Land and Water RightsLand Rights TX - Riverview67612.4100 %840.0000%0(84)Total/Composite67612.4100 %840.0000%0(84)E341 Structures and ImprovementsCarlsbad240,088- %-0.7596%1,8241,824Cunningham492,8932.1000 %10,3512.3829%11,7451,395Jones Unit 34,754,4392.0826 % (2)99,0162.2852%108,6479,631Jones Unit 45,039,7342.1112 % (4)106,3992.2924%115,5319,132Maddox1,602,8565.1800 %83,0283.1417%50,357(32,671)Quay County869,0752.9675 % (5)25,7904.6045%40,01714,227Total/Composite12,999,0872.4970 %324,5832.5242%328,1213,537E342 Fuel Holders and Accessory EquipmentBlackhawk3,598,1144.4444 %159,9153.4011%122,377(37,538)Cunningham1,211,9372.1100 %25,5722.9681%35,97110,399Jones Unit 302.0826 % (2)-0-Jones Unit 402.1112 % (4)0-Maddox512,8860.1100 %5640.6839%3,5082,943Quay County1,5752.9675 % (5)472.9259%46(1)Total/Composite5,324,5123.4951 %186,0973.0407%161,902(24,196)E343 Prime MoversCarlsbad2,265,3931.6100 %36,4732.8381%64,29427,821Cunningham51,683,6472.1000 %1,085,3572.2590%1,167,54882,192Jones Unit 302.0826 % (2)-0-Jones Unit 402.1112 % (4)Quay County4,620,1552.9675 % (5)137,1031.5538%71,790(65,313)Total/Composite58,569,1962.1495 %1,258,9332.2258%1,303,63344,700E344 GeneratorsCarlsbad409,729- %-1.8583%7,6147,614Cunningham3,108,1572.6800 %83,2992.8463%88,4675,169Jones Unit 366,307,9692.0826 % (2)1,380,9302.2852%1,515,248134,319Appendix BPage 6 of 7PlantApproved (1)Depreciation Proposed Depreciation DepreciationBalanceAccrualAccrualAccrualAccrualAccrualAccountDescription41455.00Rates Note Approved RatesRatesProposedDifferenceSouthwestern Public Service CompanyTexasComparison Of Approved vs. Proposed Accrual RatesJune 30, 2013Jones Unit 464,441,9892.1112 % (4)1,360,4992.2924%1,477,271116,772Maddox15,142,4090.0000 %-1.4170%214,570214,570Quay County16,514,3302.9675 % (5)490,0634.3478%718,003227,940Total/Composite165,924,5821.9978 %3,314,7902.4235%4,021,173706,383E345 Accessory Electric EquipmentCarlsbad239,463- %-0.9518%2,2792,279Cunningham5,882,5842.1700 %127,6522.4438%143,75916,107Jones Unit 310,412,5942.0826 % (2)216,8532.2852%237,94521,093Jones Unit 49,809,3802.1112 % (4)207,0962.2924%224,87117,775Maddox1,372,8591.5600 %21,4173.4361%47,17325,756Quay County2,728,6682.9675 % (5)80,9734.0481%110,45929,486Total/Composite30,445,5482.1481 %653,9902.5176%766,486112,496E346 Miscellaneous Power Plant EquipmentCarlsbad2,398- %-0.8830%2121Cunningham1,183,1772.0800 %24,6102.9342%34,71710,107Jones Unit 31,594,0202.0826 % (2)33,1972.2852%36,4263,229Jones Unit 41,013,9422.1112 % (4)21,4062.2924%23,2441,837Maddox86,4861.7400 %1,5050.8559%740(765)Quay County611,0492.9675 % (5)18,1334.1774%25,5267,393Total/Composite4,491,0712.2011 %98,8512.6870%120,67421,823Total Other Production277,754,6722.1016 %5,837,3292.4129%6,701,988864,659Total Production1,973,179,4481.4405 %28,422,7552.6051% 51,404,04622,981,290Transmission350 Land Rights62,564,0241.1900 %744,5121.2527%783,73339,222352 Structures & Improvements41,772,4912.2200 %927,3491.7790%743,126(184,224)353 Station Equipment519,493,0781.8400 %9,558,6732.0947% 10,881,6811,323,009354 Towers & Fixtures8,263,8251.3000 %107,4301.4073%116,2938,864355 Poles & Fixtures502,260,2353.2700 %16,423,9102.9714% 14,924,131(1,499,778)356 Overhead Conductors & Devices223,715,1412.3900 %5,346,7922.6655%5,963,170616,378357 Underground Conduit255,0730.9500 %2,4231.3553%3,4571,034358 Underground Conductor & Devices489,7171.2500 %6,1212.2523%11,0304,909Total Trans1,358,813,5832.4372 %33,117,2102.4600% 33,426,623309,413Appendix BPage 7 of 7PlantApproved (1)Depreciation Proposed Depreciation DepreciationBalanceAccrualAccrualAccrualAccrualAccrualAccountDescription41455.00Rates Note Approved RatesRatesProposedDifferenceSouthwestern Public Service CompanyTexasComparison Of Approved vs. Proposed Accrual RatesJune 30, 2013Distribution Texas Only360 Land Rights 1,719,148 1.4300 % 24,5841.6217% 27,879 3,295361 Structures & Improvements 4,921,783 2.2100 % 108,7711.7838% 87,794 (20,978)362 Station Equipment 98,948,650 1.9900 % 1,969,0782.0405% 2,019,058 49,979364 Poles, Towers & Fixtures 139,455,232 2.5800 % 3,597,9452.8236% 3,937,655 339,710365 Overhead Conductors & Devices 132,658,666 2.6100 % 3,462,3912.8150% 3,734,366 271,975366 Underground Conduit 16,425,003 2.8300 % 464,8281.9344% 317,725 (147,103)367 Underground Conductor & Devices 23,183,047 2.5300 % 586,5312.4853% 576,177 (10,354)368 Line Transformers 140,143,332 2.1900 % 3,069,1392.3820% 3,338,220 269,081369 Services 49,206,245 2.5900 % 1,274,4423.0705% 1,510,882 236,440370 Meters 47,999,178 3.0600 % 1,468,7752.6274% 1,261,121 (207,654)371 Installations on Customers' Premises 8,129,480 4.6100 % 374,7694.4893% 364,956 (9,813)373 Street Lighting & Signal Systems 12,872,741 4.1600 % 535,5063.4073% 438,608 (96,898)Total Distribution Texas Only 675,662,504 2.5067 % 16,936,7592.6070% 17,614,441 677,682General389 Land Rights 45,967 1.2900 % 5932.8572% 1,313 720390 Structures & Improvements 61,238,258 1.3200 % 808,3452.7244% 1,668,388 860,043390 Structures & Improvements - Tower Lease 0 - % (3) -0 -390 Structures & Improvements - Remodel Lease 4,216,154 - % (3) -0 -391 Office Furniture & Equipment 8,491,525 3.8000 % 322,6785.2970% 449,799 127,121391 Computer Equipment 18,695,295 20.0000 % 3,739,05929.1137% 5,442,888 1,703,829392 Transportation Equipment 49,236,663 6.3400 % 3,121,60411.6900% 5,755,749 2,634,144393 Stores Equipment 390,707 2.0900 % 8,1665.2251% 20,415 12,249394 Tool, Shop & Garage Equipment 19,883,544 2.7200 % 540,8323.3925% 674,557 133,725395 Laboratory Equipment 8,148,910 4.6000 % 374,8507.9292% 646,146 271,297396 Power Operated Equipment 8,615,343 6.1900 % 533,2906.5809% 566,966 33,677397 Communication Equipment 43,749,192 5.1000 % 2,231,2097.5926% 3,321,696 1,090,488397 Communication Equipment - EMS 3,300,457 5.1000 % 168,3234.8484% 160,020 (8,303)398 Miscellaneous Equipment 2,563,867 4.1400 % 106,1446.4149% 164,468 58,324Total General 228,575,883 5.2303 % 11,955,0938.2565% 18,872,406 6,917,313Total Plant 4,236,231,418 2.1347 % 90,431,8172.8638% 121,317,515 30,885,698(2) Approved rates for Jones Unit 3 are from PUC Docket No. 40824(3) Assets amortized over the lease term.(4) Approved rates for Jones 4 are from PUC Docket No. 40824(5) Approved rates for Quay County are from PUC Docket No. 40824(1) Approved rates from PUC Docket No. 35763, set forth in Exhibit A to the Stipulation, unless noted otherwise. Some transmission, distribution & general rate information (curves, Life, etc) was from PUCDocket No. 32766, Exhibit C, to the Stipulation.

# 86 APPENDIX C

Comparison of Depreciation ParametersAppendix C-1Page 1 of 7FERCAcctAcctDescription UnitRetirementDateInterimRetirementCurveNet Salvage% NoteRetirementDateInterimRetirementCurveNet Salvage%Steam ProductionE310 Land and Water RightsLand Rights NM Composite 0% Composite 0%Land Rights TX Composite 0% Composite 0%Water Rights TX Composite 0% Composite 0%E311 Structures and ImprovementsCunningham Unit 1 2014 NA 5% 2022 74 R2 -5%Cunningham Unit 2 2025 NA 5% 2025 74 R2 -5%Common Facilities 2025 NA 5% 2025 74 R2 -5%Harrington Unit 1 2036 NA 5% 2036 74 R2 -5%Harrington Unit 2 2038 NA 5% 2038 74 R2 -5%Harrington Unit 3 2040 NA 5% 2040 74 R2 -5%Common Facilities 2040 NA 5% 2040 74 R2 -5%Jones Unit 1 2031 NA 5% 2031 74 R2 -5%Jones Unit 2 2034 NA 5% 2034 74 R2 -5%Common Facilities 2034 NA 5% 2058 74 R2 -5%Maddox 2030 NA 5% 2030 74 R2 -5%Moore County 2014 NA 5% 2013 74 R2 -5%Nichols Unit 1 2020 NA 5% 2020 74 R2 -5%Nichols Unit 2 2022 NA 5% 2023 74 R2 -5%Nichols Unit 3 2030 NA 5% 2030 74 R2 -5%Common Facilites 2030 NA 5% 2030 74 R2 -5%Plant X Unit 1 2014 NA 5% 2019 74 R2 -5%Plant X Unit 2 2014 NA 5% 2019 74 R2 -5%Plant X Unit 3 2020 NA 5% 2021 74 R2 -5%Plant X Unit 4 2027 NA 5% 2027 74 R2 -5%Common Facilities 2027 NA 5% 2027 74 R2 -5%Tolk 1 2042 NA 5% 2042 74 R2 -5%Tolk 2 2045 NA 5% 2045 74 R2 -5%Common Facilities 2045 NA 5% 2045 74 R2 -5%Southwestern Public Service Company - TexasComparison of Depreciation ParametersJune 30, 2013Approved (1)ProposedAppendix C-1Page 2 of 7FERCAcctAcctDescription UnitRetirementDateInterimRetirementCurveNet Salvage% NoteRetirementDateInterimRetirementCurveNet Salvage%Southwestern Public Service Company - TexasComparison of Depreciation ParametersJune 30, 2013Approved (1) ProposedE312 Boiler Plant EquipmentCunningham Unit 12014 NA5%2022 58 R2 -5%Cunningham Unit 22025 NA5%2025 58 R2 -5%Common Facilities2025 NA5%2025 58 R2 -5%Harrington Unit 12036 NA5%2036 58 R2 -5%Harrington Unit 22038 NA5%2038 58 R2 -5%Harrington Unit 32040 NA5%2040 58 R2 -5%Common Facilities2040 NA5%2040 58 R2 -5%Jones Unit 12031 NA5%2031 58 R2 -5%Jones Unit 22034 NA5%2034 58 R2 -5%Common Facilities2034 NA5%2058 58 R2 -5%Maddox2030 NA5%2030 58 R2 -5%Moore County2014 NA5%2013 58 R2 -5%Nichols Unit 12020 NA5%2020 58 R2 -5%Nichols Unit 22022 NA5%2023 58 R2 -5%Nichols Unit 32030 NA5%2030 58 R2 -5%Common Facilites2030 NA5%2030 58 R2 -5%Plant X Unit 12014 NA5%2019 58 R2 -5%Plant X Unit 22014 NA5%2019 58 R2 -5%Plant X Unit 32020 NA5%2021 58 R2 -5%Plant X Unit 42027 NA5%2027 58 R2 -5%Common Facilities2027 NA5%2027 58 R2 -5%Tolk 12042 NA5%2042 58 R2 -5%Tolk 22045 NA5%2045 58 R2 -5%Common Facilities2045 NA5%2045 58 R2 -5%Appendix C-1Page 3 of 7FERCAcctAcctDescription UnitRetirementDateInterimRetirementCurveNet Salvage% NoteRetirementDateInterimRetirementCurveNet Salvage%Southwestern Public Service Company - TexasComparison of Depreciation ParametersJune 30, 2013Approved (1) ProposedE314 TurbogeneratorsCunningham Unit 12014 NA5%2022 71 R1.5 -5%Cunningham Unit 22025 NA5%2025 71 R1.5 -5%Common Facilities2025 NA5%2025 71 R1.5 -5%Harrington Unit 12036 NA5%2036 71 R1.5 -5%Harrington Unit 22038 NA5%2038 71 R1.5 -5%Harrington Unit 32040 NA5%2040 71 R1.5 -5%Common Facilities2040 NA5%2040 71 R1.5 -5%Jones Unit 12031 NA5%2031 71 R1.5 -5%Jones Unit 22034 NA5%2034 71 R1.5 -5%Common Facilities2034 NA5%2058 71 R1.5 -5%Maddox2030 NA5%2030 71 R1.5 -5%Moore County2014 NA5%2013 71 R1.5 -5%Nichols Unit 12020 NA5%2020 71 R1.5 -5%Nichols Unit 22022 NA5%2023 71 R1.5 -5%Nichols Unit 32030 NA5%2030 71 R1.5 -5%Common Facilites2030 NA5%2030 71 R1.5 -5%Plant X Unit 12014 NA5%2019 71 R1.5 -5%Plant X Unit 22014 NA5%2019 71 R1.5 -5%Plant X Unit 32020 NA5%2021 71 R1.5 -5%Plant X Unit 42027 NA5%2027 71 R1.5 -5%Common Facilities2027 NA5%2027 71 R1.5 -5%Tolk 12042 NA5%2042 71 R1.5 -5%Tolk 22045 NA5%2045 71 R1.5 -5%Common Facilities2045 NA5%2045 71 R1.5 -5%Appendix C-1Page 4 of 7FERCAcctAcctDescription UnitRetirementDateInterimRetirementCurveNet Salvage% NoteRetirementDateInterimRetirementCurveNet Salvage%Southwestern Public Service Company - TexasComparison of Depreciation ParametersJune 30, 2013Approved (1) ProposedE315 Accessory Electric EquipmentCunningham Unit 1 2014 NA 5% 2022 64 L2.5 -5%Cunningham Unit 2 2025 NA 5% 2025 64 L2.5 -5%Common Facilities 2025 NA 5% 2025 64 L2.5 -5%Harrington Unit 1 2036 NA 5% 2036 64 L2.5 -5%Harrington Unit 2 2038 NA 5% 2038 64 L2.5 -5%Harrington Unit 3 2040 NA 5% 2040 64 L2.5 -5%Common Facilities 2040 NA 5% 2040 64 L2.5 -5%Jones Unit 1 2031 NA 5% 2031 64 L2.5 -5%Jones Unit 2 2034 NA 5% 2034 64 L2.5 -5%Common Facilities 2034 NA 5% 2058 64 L2.5 -5%Maddox 2030 NA 5% 2030 64 L2.5 -5%Moore County 2014 NA 5% 2013 64 L2.5 -5%Nichols Unit 1 2020 NA 5% 2020 64 L2.5 -5%Nichols Unit 2 2022 NA 5% 2023 64 L2.5 -5%Nichols Unit 3 2030 NA 5% 2030 64 L2.5 -5%Common Facilites 2030 NA 5% 2030 64 L2.5 -5%Plant X Unit 1 2014 NA 5% 2019 64 L2.5 -5%Plant X Unit 2 2014 NA 5% 2019 64 L2.5 -5%Plant X Unit 3 2020 NA 5% 2021 64 L2.5 -5%Plant X Unit 4 2027 NA 5% 2027 64 L2.5 -5%Common Facilities 2027 NA 5% 2027 64 L2.5 -5%Tolk 1 2042 NA 5% 2042 64 L2.5 -5%Tolk 2 2045 NA 5% 2045 64 L2.5 -5%Appendix C-1Page 5 of 7FERCAcctAcctDescription UnitRetirementDateInterimRetirementCurveNet Salvage% NoteRetirementDateInterimRetirementCurveNet Salvage%Southwestern Public Service Company - TexasComparison of Depreciation ParametersJune 30, 2013Approved (1) ProposedE316 Miscellaneous Power Plant EquipmentCunningham Unit 1 2014 NA 5% 2022 56 S0 -5%Cunningham Unit 2 2025 NA 5% 2025 56 S0 -5%Common Facilities 2025 NA 5% 2025 56 S0 -5%Harrington Unit 1 2036 NA 5% 2036 56 S0 -5%Harrington Unit 2 2038 NA 5% 2038 56 S0 -5%Harrington Unit 3 2040 NA 5% 2040 56 S0 -5%Common Facilities 2040 NA 5% 2040 56 S0 -5%Jones Unit 1 2031 NA 5% 2031 56 S0 -5%Jones Unit 2 2034 NA 5% 2034 56 S0 -5%Common Facilities 2034 NA 5% 2058 56 S0 -5%Maddox 2030 NA 5% 2030 56 S0 -5%Moore County 2014 NA 5% 2013 56 S0 -5%Nichols Unit 1 2020 NA 5% 2020 56 S0 -5%Nichols Unit 2 2022 NA 5% 2023 56 S0 -5%Nichols Unit 3 2030 NA 5% 2030 56 S0 -5%Common Facilites 2030 NA 5% 2030 56 S0 -5%Plant X Unit 1 2014 NA 5% 2019 56 S0 -5%Plant X Unit 2 2014 NA 5% 2019 56 S0 -5%Plant X Unit 3 2020 NA 5% 2021 56 S0 -5%Plant X Unit 4 2027 NA 5% 2027 56 S0 -5%Common Facilities 2027 NA 5% 2027 56 S0 -5%Tolk 1 2042 NA 5% 2042 56 S0 -5%Tolk 2 2045 NA 5% 2045 56 S0 -5%Common Facilities 2045 NA 5% 2045 56 S0 -5%Appendix C-1Page 6 of 7FERCAcctAcctDescription UnitRetirementDateInterimRetirementCurveNet Salvage% NoteRetirementDateInterimRetirementCurveNet Salvage%Southwestern Public Service Company - TexasComparison of Depreciation ParametersJune 30, 2013Approved (1) ProposedOther ProductionE340 Land and Water RightsLand Rights TX - Riverview 2014 NA 0% 2013 NA 0%E341 Structures and ImprovementsCarlsbad 2025 NA 5% 2025 NA -5%Cunningham 2040 NA 5% 2040 NA -5%Jones Unit 3 2056 NA 5% (2) 2056 NA -5%Jones Unit 4 NA NA 5% 2058 NA -5%Maddox 2020 NA 5% 2020 NA -5%Quay County 2035 NA 5% 2035 NA -5%Riverview 2014 NA 5% 2013 NA -5%E342 Fuel Holders and Accessory EquipmentBlackhawk NA NA NA 2024 NA -5%Cunningham 2040 NA 5% 2040 NA -5%Jones Unit 3 2056 NA 5% (2) 2056 NA -5%Jones Unit 4 NA NA 5% 2058 NA -5%Maddox 2020 NA 5% 2020 NA -5%Quay County 2035 NA 5% 2035 NA -5%Riverview 2014 NA 5% 2013 NA -5%E343 Prime MoversCarlsbad 2025 NA 5% 2025 NA -5%Cunningham 2040 NA 5% 2040 NA -5%Jones Unit 3 2056 NA 5% (2) 2056 NA -5%Jones Unit 4 NA NA 5% 2058 NA -5%Quay County 2035 NA 5% 2035 NA -5%Riverview 2014 NA 5% 2013 NA -5%Appendix C-1Page 7 of 7FERCAcctAcctDescription UnitRetirementDateInterimRetirementCurveNet Salvage% NoteRetirementDateInterimRetirementCurveNet Salvage%Southwestern Public Service Company - TexasComparison of Depreciation ParametersJune 30, 2013Approved (1) ProposedE344 GeneratorsCarlsbad 2025 NA 5% 2025 NA -5%Cunningham 2040 NA 5% 2040 NA -5%Jones Unit 3 2056 NA 5% (2) 2056 NA -5%Jones Unit 4 NA NA 5% 2058 NA -5%Maddox 2020 NA 5% 2020 NA -5%Quay County 2035 NA 5% 2035 NA -5%Riverview 2014 NA 5% 2013 NA -5%E345 Accessory Electric EquipmentCarlsbad 2025 NA 5% 2025 NA -5%Cunningham 2040 NA 5% 2040 NA -5%Jones Unit 3 2056 NA 5% (2) 2056 NA -5%Jones Unit 4 NA NA 5% 2058 NA -5%Maddox 2020 NA 5% 2020 NA -5%Quay County 2035 NA 5% 2035 NA -5%Riverview 2014 NA 5% 2013 NA -5%E346 Miscellaneous Power Plant EquipmentCarlsbad 2025 NA 5% 2025 NA -5%Cunningham 2040 NA 5% 2040 NA -5%Jones Unit 3 2056 NA 5% (2) 2056 NA -5%Jones Unit 4 NA NA 5% 2058 NA -5%Maddox 2020 NA 5% 2020 NA -5%Quay County 2035 NA 5% 2035 NA -5%Riverview 2014 NA 5% 2013 NA -5%(2) Approved rates for Jones Unit 3 are from PUC Docket No. 39681(1) Approved rates from PUC Docket No. 35763, set forth in Exhibit A to the Stipulation, unless noted otherwise. Some transmission, distribution & generalrate information (curves, Life, etc) was from PUC Docket No. 32766, Exhibit C, to the Stipulation.Appendix C-2Page 1 of 1Account DescriptionAverageService Life Iowa CurveNet Salvage%AverageService Life Iowa CurveNet Salvage%Transmission350 Land and Land Rights 70 R4 0% 80 R4 0%352 Structures and Improvements 55 R4 -20% 65 R4 -15%353 Station Equipment 55 R4 -5% 57 R2.5 -19%354 Towers and Fixtures 75 R3 0% 75 R3 -5%355 Poles and Fixtures 40 R5 -20% 54 R3 -60%356 Overhead Conductor 42 R2.5 -10% 49 R2.5 -30%357 Underground Conduit 75 R3 0% 75 R3 0%358 Underground Conductor and Devices 45 R3 0% 45 R3 0%Distribution360 Land and Land Rights 60 R4 0% 60 R4 0%361 Structures and Improvements 52 R2 -15% 60 R1.5 -10%362 Station Equipment 52 R2 -10% 55 R1.5 -15%364 Poles, Towers, and Fixtures 40 S1 -25% 52 R0.5 -50%365 Overhead Conductor and Devices 40 S1 -20% 47 R0.5 -35%366 Underground Conduit 40 R4 -10% 60 R2.5 -20%367 Underground Conductor and Devices 41 R2.5 -5% 47 R1.5 -20%368 Line Transformers 45 R1.5 -5% 45 R1 -10%369 Services 42 R2 -40% 44 R2 -40%370 Meters 38 R5 -5% 40 R2 -10%371 Installations on Customers' Premises 18 R2 -15% 25 R0.5 -20%373 Street Lighting 38 R3 -30% 41 R2 -45%General389 Land and Land Rights 50 R4 0% 55 R4 0%390 Structures and Improvements 45 R2 0% 52 R1.5 -10%391 Office Furniture and Equipment 25 L1.5 2% 25 SQ 0%391 Computer Equipment 5 R2 0% 5 SQ 0%392 Transportation Equipment 11 L3 20% 11 SQ 0%393 Stores Equipment 45 R2.5 0% 35 SQ 0%394 Tool, Shop, and Garage Equipment 35 S0.5 0% 35 SQ 0%395 Laboratory Equipment 25 R1 0% 25 SQ 0%396 Power Operated Equipment 18 L2 10% 18 SQ 0%397 Communication Equipment 23 R4 0% 23 SQ -4%397 Communication Equipment - EMS 23 R4 0% 23 SQ -4%398 Miscellaneous Equipment 24 L0.5 0% 24 SQ 0%Southwestern Public Service Company - TexasTransmission, Distribution, and General PlantComparison of Depreciation ParametersJune 30, 2013Approved (1) Proposed(1) Approved rates from PUC Docket No. 35763, set forth in Exhibit A to the Stipulation, unless noted otherwise. Some transmission, distribution & general rateinformation (curves, Life, etc) was from PUC Docket No. 32766, Exhibit C, to the Stipulation.

# 99 APPENDIX D

Retirement Data for all Generating UnitsAppendix DPage 1 of 1Unit NameNet DependableCapacity (MW) LocationIn-serviceDateServiceLifeDepreciationRetirementDateDepreciationRetirementDateServiceLifeRemaining Lifeas of June 30,2013Change inService LifeSteam Production - Gas/OilJones Unit 1243Lubbock, TX 197160 203120316018.50Jones Unit 2243Lubbock, TX 197460 203420346021.50Plant X Unit 148Earth, TX 195262 20142019676.55Plant X Unit 2102Earth, TX 195361 20142019666.55Plant X Unit 3103Earth, TX 195565 20202021668.51Plant X Unit 4189Earth, TX 196463 202720276314.50Steam Production - GasCunningham Unit 1 71Hobbs, NM 195757 20142022659.58Cunningham Unit 2 196Hobbs, NM 196560 202520256012.50Maddox Unit 1118Hobbs, NM 196763 203020306317.50Moore Unit 348Amarillo, TX 195460 20142013590.0(1)Nichols Unit 1107Amarillo, TX 196060 20202020607.50Nichols Unit 2106Amarillo, TX 196260 202220236110.51Nichols Unit 3244Amarillo, TX 196862 203020306217.50Steam Production - CoalHarrington Unit 1347Amarillo, TX 197660 203620366023.50Harrington Unit 2347Amarillo, TX 197860 203820386025.50Harrington Unit 3347Amarillo, TX 198060 204020406027.50Tolk Unit 1540Muleshoe, TX 198260 204220426029.50Tolk Unit 2540Muleshoe, TX 198560 204520456032.50Other Production - CTBlackhawkHobbs, NM 1999NA NA20242511.5NACarlsbad Unit 111Carlsbad, NM 196857 202520255712.50Cunningham Unit 3 109Hobbs, NM 199743 204020404327.50Cunningham Unit 4 109Hobbs, NM 199743 204020404327.50Jones Unit 3169Lubbock, TX 201145 205620564543.50Jones Unit 4169Lubbock, TX 2013NA NA20584545.5NAMaddox Unit 260Hobbs, NM 197545 20202020457.50Maddox Unit 3Note (1) Hobbs, NM 196357 20202020577.50Quay County23Borger, TX 2013NA NA20352222.5NARiverview Unit 423Amarillo, TX 194074 20142013730.0(1)Southwestern Public Service CompanyTexasRetirement Data for all Generating UnitsJune 30, 2013CurrentProposed

# 101 APPENDIX E

Net Salvage Analysis by AccountAppendix E-1Page 1 of 92- yr 3- yr 4- yr 5- yr 6- yr 7- yr 8- yr 9- yr 10- yrFERC Removal Net Net Net Net Net Net Net Net Net Net NetAcct ActivityRetirement Salvage Costs Salvage Salvage%Salvage%Salvage%Salvage%Salvage%Salvage%Salvage%Salvage%Salvage%Salvage%311 1977 34,5481,4002,015(615)-1.78%311 1978 72,60420,28211,5268,75612.06% 7.60%311 1979 17,59814,83912,9171,92210.92% 11.84% 8.07%311 1980 579-50(50)-8.64% 10.30% 11.71% 7.99%311 1981 47,94753338,855(38,322)-79.93% -79.08% -55.12% -19.96% -16.34%311 1982 5,339-632(632)-11.84% -73.10% -72.41% -51.89% -19.66% -16.20%311 1983 20,7954,33518,927(14,592)-70.17% -58.25% -72.28% -71.79% -56.01% -26.03% -21.83%311 1984 28,0603825,836(5,454)-19.44% -41.03% -38.16% -57.76% -57.49% -47.48% 6.85% -21.54%311 1985 105,03868320,152(19,469)-18.54% -18.73% -25.68% -25.21% -37.87% -37.79% -33.99% -22.77% -20.59%311 1986 8,347,60799,675254,484(154,809)-1.85% -2.06% -2.12% -2.29%-2.29% -2.73% -2.73% -2.70% -2.58% -2.57%311 1987 11,4508,38137,237(28,856)-252.02% -2.20% -2.40% -2.46% -2.62% -2.63% -3.06% -3.06% -3.03% -2.91%311 1988 81,7341,655154,797(153,142)-187.37% -195.31% -3.99% -4.17%-4.22% -4.38% -4.38% -4.80% -4.80% -4.77%311 1989 6,90613,62431,578(17,954)-259.98% -193.02% -199.77% -4.20% -4.38% -4.42% -4.58% -4.59% -5.01% -5.01%311 1990 62,6351,46942,260(40,791)-65.12% -84.48% -140.07% -147.94% -4.65% -4.82% -4.86% -5.02% -5.03% -5.44%311 1991 97,2882,38818,772(16,384)-16.84% -35.75% -45.03% -91.84% -98.89% -4.79% -4.95% -5.00% -5.15% -5.16%311 1992 73,444-19,465(19,465)-26.50% -21.00% -32.84% -39.37% -76.93% -82.95% -4.97% -5.13% -5.18% -5.33%311 1993 284,1016567,547(67,482)-23.75% -24.32% -22.72% -27.85% -30.91% -52.01% -55.72% -5.56% -5.71% -5.76%311 1994 10,292-3,061(3,061)-29.74% -23.96% -24.47% -22.87% -27.89% -30.89% -51.64% -55.29% -5.59% -5.74%311 1995 (1,548,787)-21,250(21,250)1.37%1.58%7.32% 9.42%11.78% 16.50% 18.38%36.42%40.00% -7.04%311 1996 74,580-61,401(61,401)-82.33%5.61%5.86% 12.98% 15.61% 18.73% 24.28% 26.37% 46.74% 50.78%311 19973,063---0.00% -79.08%5.62% 5.87% 13.02% 15.65% 18.79% 24.36% 26.46% 46.91%311 1998 28,250-17,263(17,263)-61.11% -55.13% -74.29%6.92% 7.19% 14.84% 17.67% 21.10% 27.00% 29.18%311 1999500---0.00% -60.05%-54.26% -73.94% 6.93% 7.19% 14.85% 17.67% 21.11% 27.02%311 2000----NANANA NA NA NA NA NA NANA311 2001----NANANA NA NA NA NA NA NANA311 2002 1,921,674112,436224,600(112,164)-5.84% -5.84% -5.84% -5.84%-6.64% -6.63% -9.41% -44.25% -43.94% -36.53%311 2003 1,149,02681856(775)-0.07% -3.68% -3.68%-3.68% -3.68% -4.20% -4.20% -6.03% -13.07% -13.18%311 20048,000321-3214.01% -0.04% -3.66%-3.66% -3.66% -3.66% -4.18% -4.18% -6.01% -12.99%311 2005 1,191,214-364,575(364,575)-30.61% -30.37% -15.54% -11.18%-11.18% -11.18% -11.17% -11.50% -11.49% -12.70%311 2006----NANANA NA NA NA NA NA NANA311 2007 87,570-395,628(395,628)-451.78% -451.78% -59.45% -59.05%-31.23% -20.03% -20.03% -20.03% -20.03% -20.29%311 2008 1,377,139-123,623(123,623)-8.98% -35.45% -35.45% -33.28%-33.17% -23.19% -17.38% -17.38% -17.38% -17.37%311 2009----NANANA NA NA NA NA NA NANA311 2010----NANANA NA NA NA NA NA NANA311 2011 2,282,274-1,123,146(1,123,146)-49.21% -49.21% -49.21% -34.07% -43.83% -43.83% -40.64% -40.57% -32.93% -26.44%311 2012 1,236,630-598,160(598,160)-48.37% -48.92%-48.92% -48.92%-37.68% -44.96% -44.96% -42.19% -42.13% -35.54%312 1977 97,421632669(37)-0.04%312 19782,39786,20513,19473,0113045.93% 73.11%312 19793,918-5,011(5,011)-127.90% 1076.80% 65.52%312 1980 35,075-23,596(23,596)-67.27% -73.36% 107.28% 31.96%312 19814,479-875(875)-19.54% -61.87% -67.82% 94.90% 30.35%312 1982 29,975501,000(950)-3.17% -5.30% -36.56% -41.43% 56.14% 24.55%312 1983 58,93828620,368(20,082)-34.07% -23.65% -23.46% -35.42% -38.16% 16.69% 9.67%312 1984 161,49518,1432,54115,6029.66% -2.03% -2.17% -2.47% -10.31% -11.88% 6.85% 9.67%312 1985 275,342-33,502(33,502)-12.17% -4.10% -7.66%-7.41% -7.51% -11.22% -12.02% 0.80% 0.68%312 1986 27,745,379275,392603,338(327,946)-1.18% -1.29% -1.23% -1.30%-1.30% -1.30% -1.38% -1.40% -1.14% -1.14%312 1987 3,724,64512,266321,463(309,197)-8.30% -2.02% -2.11% -2.05%-2.11% -2.11% -2.12% -2.19% -2.20% -1.97%312 1988 1,104,884555461,333(460,778)-41.70% -15.94% -3.37% -3.44%-3.38% -3.43% -3.43% -3.44% -3.50% -3.52%312 1989 762,28323,542218,235(194,693)-25.54% -35.11% -17.25% -3.88%-3.95% -3.88% -3.93% -3.93% -3.93% -4.00%312 1990 1,314,783361196,576(196,215)-14.92% -18.82% -26.77% -16.81%-4.30% -4.36% -4.29% -4.34% -4.34% -4.34%312 1991 1,571,4413,927170,679(166,752)-10.61% -12.58% -15.28% -21.43%-15.66% -4.57% -4.63% -4.56% -4.61% -4.61%312 1992 1,135,991-215,798(215,798)-19.00% -14.13% -14.39% -16.17%-20.96% -16.05% -5.01% -5.06% -5.00% -5.04%312 1993 2,381,160202,090217,921(15,831)-0.66% -6.59% -7.83% -9.29% -11.01% -15.11% -13.00% -4.75% -4.80% -4.74%312 1994 886,246-319,090(319,090)-36.00% -10.25% -12.51% -12.01%-12.53% -13.77% -17.14% -14.58% -5.43% -5.48%312 1995 53,916(43,957)518,294(562,251)-1042.83% -93.74% -27.01% -24.97%-21.23% -20.10% -20.61% -23.14% -18.87% -6.81%312 1996 1,797,536(4,163)507,097(511,260)-28.44% -57.98% -50.87% -27.51%-25.97% -22.88% -21.74% -22.03% -24.01% -20.04%312 1997 352,731-88,976(88,976)-25.23% -27.91% -52.74% -47.94% -27.37% -25.93% -22.99% -21.87% -22.14% -24.04%312 1998 1,735,206-212,081(212,081)-12.22% -14.42% -20.91% -34.89%-35.10% -23.72% -23.08% -21.10% -20.38% -20.71%312 1999 1,632,853---0.00% -6.30% -8.09% -14.72% -24.67% -26.22% -19.34% -19.30% -18.12% -17.79%312 2000----NANANA NA NA NA NA NA NANA312 2001----NANANA NA NA NA NA NA NANA312 2002 4,114,1564,759,4334,599,274160,1583.89%3.89%3.89% 2.79% -0.69% -1.80% -6.77% -12.54% -14.50% -11.96%312 2003 2,732,253344,690573,225(228,535)-8.36% -1.00% -1.00% -1.00%-0.81% -2.75% -3.50% -7.12% -11.62% -13.24%312 2004-1,921-1,921NANANA NA NA NA NA NA NANASouthwestern Public Service Company - TexasRetirement and Salvage AnalysisProduction and Other Production Interim Net SalvageAccounts 311 - 346Appendix E-1Page 2 of 92- yr 3- yr 4- yr 5- yr 6- yr 7- yr 8- yr 9- yr 10- yrFERC Removal Net Net Net Net Net Net Net Net Net Net NetAcct ActivityRetirement Salvage Costs Salvage Salvage%Salvage%Salvage%Salvage%Salvage%Salvage%Salvage%Salvage%Salvage%Salvage%Southwestern Public Service Company - TexasRetirement and Salvage AnalysisProduction and Other Production Interim Net SalvageAccounts 311 - 346312 2005 13,275,8112,6343,216,099(3,213,465)-24.21% -24.19% -21.49% -16.30% -16.30% -16.30% -15.08% -14.87% -15.02% -15.96%312 2006 60,00018,8952,34116,55427.59% -23.97% -23.96% -21.31% -16.17% -16.17% -16.17% -14.96% -14.76% -14.91%312 2007 13,718,21340,5102,551,077(2,510,567)-18.30% -18.10% -21.10% -21.09% -19.92% -17.03% -17.03% -17.03% -16.25% -16.06%312 2008 8,687,037(38,510)832,041(870,552)-10.02% -15.09% -14.98% -18.40%-18.40% -17.69% -15.60% -15.60% -15.60% -15.03%312 2009 5,651,075-3,696,259(3,696,259)-65.41% -31.85% -25.23% -25.11% -24.82% -24.82% -23.80% -21.44% -21.44% -21.44%312 2010 2,663,204-340,234(340,234)-12.78% -48.55% -28.86% -24.15%-24.05% -24.09% -24.09% -23.17% -20.98% -20.98%312 2011 14,985,032-4,576,145(4,576,145)-30.54% -27.86% -36.97% -29.65% -26.24% -26.17% -25.73% -25.73% -24.96% -23.16%312 2012 7,660,989-2,678,484(2,678,484)-34.96% -32.03% -30.01% -36.47% -30.67% -27.49% -27.43% -26.79% -26.79% -26.06%314 1977 99086313772673.33%314 1978 1,147,423185,765251,078(65,313)-5.69% -5.62%314 1979 ----NANANA314 1980 141,840(6)13,526(13,532)-9.54% -9.54% -6.12% -6.05%314 1981500---0.00% -9.51% -9.51% -6.11% -6.05%314 1982 23,361-2,829(2,829)-12.11% -11.86% -9.87% -9.87% -6.22% -6.16%314 19835,462-1,737(1,737)-31.80% -15.84% -15.57% -10.57% -10.57% -6.33% -6.27%314 1984 73,30135016,480(16,130)-22.01% -22.68% -20.27% -20.17% -14.00% -14.00% 6.85% -7.09%314 1985 68,127-23,769(23,769)-34.89% -28.21% -28.35% -26.12% -26.04% -18.55% -18.55% -8.45% -8.39%314 1986 18,618,499392,302447,187(54,885)-0.29% -0.42% -0.51% -0.51% -0.53% -0.53% -0.60% -0.60% -0.89% -0.88%314 1987 150,674100,115181,116(81,001)-53.76% -0.72%-0.85% -0.93% -0.94% -0.95% -0.95% -1.02% -1.02% -1.28%314 1988 2,457,24511,962413,555(401,593)-16.34% -18.50% -2.53% -2.64%-2.70% -2.71% -2.72% -2.72% -2.76% -2.76%314 1989 1,957,89052,84880,396(27,548)-1.41% -9.72% -11.17% -2.44% -2.53% -2.59% -2.60% -2.61% -2.61% -2.65%314 1990 581,47823,440172,523(149,083)-25.64% -6.96% -11.57% -12.81%-3.00% -3.10% -3.15% -3.16% -3.17% -3.17%314 1991 160,2182,113161,284(159,171)-99.35% -41.56% -12.44% -14.30%-15.42% -3.65% -3.74% -3.79% -3.80% -3.81%314 1992 2,904,05631,034248,018(216,984)-7.47% -12.28% -14.41% -9.86%-11.84% -12.61% -4.06% -4.14% -4.19% -4.20%314 1993 2,748,461384,640348,58036,0601.31% -3.20% -5.85% -7.65% -6.19% -8.50% -9.12% -3.56% -3.64% -3.68%314 1994 468,203208556,949(556,741)-118.91% -16.19% -12.05% -14.28%-15.24% -12.17% -13.08% -13.62% -5.36% -5.43%314 1995 (2,283,785)308270,791(270,484)11.84% 45.56% -84.81% -26.27% -29.20% -28.75% -20.56% -19.41% -19.97% -6.78%314 1996 751,140(1,000)303,323(304,323)-40.51% 37.50% 106.30% -65.05% -28.61% -30.99% -30.41% -22.62% -21.04% -21.53%314 1997 3,000,000---0.00% -8.11% -39.17% -58.46% -23.39% -17.30% -18.99% -19.46% -16.02% -16.08%314 1998 25,000-440(440)-1.76% -0.01% -8.07%-38.55% -57.74% -23.27% -17.25% -18.94% -19.40% -15.99%314 1999 50,000---0.00% -0.59% -0.01% -7.97% -37.30% -56.30% -23.03% -17.13% -18.82% -19.29%314 2000----NANANA NA NA NA NA NA NANA314 2001----NANANA NA NA NA NA NA NANA314 2002 2,665,854282,7551,422,841(1,140,086)-42.77% -42.77% -42.77% -41.98% -41.61% -19.87% -22.26% -40.76% -48.59% -30.12%314 2003 543,94859,262379,273(320,011)-58.83% -45.49% -45.49% -45.49%-44.79% -44.46% -23.24%-25.08% -42.83% -49.65%314 2004----NANANA NA NA NA NA NA NANA314 2005 9,204,755-2,342,687(2,342,687)-25.45% -25.45% -27.31% -30.63% -30.63% -30.63% -30.51% -30.45% -24.55% -25.29%314 2006 53,000-14,108(14,108)-26.62% -25.46% -25.46% -27.31% -30.61% -30.61% -30.61% -30.49% -30.44% -24.56%314 2007 1,129,2695,000901,674(896,674)-79.40% -77.04% -31.32% -31.32%-32.69% -34.67% -34.67% -34.67% -34.54% -34.48%314 2008 2,013,199-88,888(88,888)-4.42% -31.36% -31.28% -26.95% -26.95% -28.29% -30.77% -30.77% -30.77% -30.67%314 2009 242,567-205,894(205,894)-84.88% -13.07% -35.20% -35.07%-28.07% -28.07% -29.33% -31.59% -31.59% -31.59%314 2010----NANANA NA NA NA NA NA NANA314 2011 2,208,916-1,101,807(1,101,807)-49.88% -49.88% -53.34% -31.28% -41.00% -40.86% -31.31% -31.31% -32.28% -33.83%314 2012 3,213,367-2,354,232(2,354,232)-73.26% -63.74% -63.74% -64.64% -48.85% -52.77% -52.61% -38.77% -38.77% -39.36%Appendix E-1Page 3 of 92- yr 3- yr 4- yr 5- yr 6- yr 7- yr 8- yr 9- yr 10- yrFERC Removal Net Net Net Net Net Net Net Net Net Net NetAcct ActivityRetirement Salvage Costs Salvage Salvage%Salvage%Salvage%Salvage%Salvage%Salvage%Salvage%Salvage%Salvage%Salvage%Southwestern Public Service Company - TexasRetirement and Salvage AnalysisProduction and Other Production Interim Net SalvageAccounts 311 - 346315 1977 24,0504,1642,4801,6847.00%315 1978 (1,386)87,3196,88880,431-5803.10% 362.31%315 1979 50,466-5,512(5,512)-10.92% 152.65% 104.75%315 1980 28,482-787(787)-2.76% -7.98% 95.58% 74.61%315 1981 2,170-389(389)-17.93% -3.84% -8.24% 92.49% 72.68%315 1982 32,9554,9221,6963,2269.79% 8.08% 3.22% -3.03% 68.30% 57.52%315 1983 401-525(525)-130.92% 8.10% 6.51% 2.38% -3.48% 67.60% 56.97%315 1984 15,7862591,783(1,524)-9.65% -12.66% 2.40% 1.54% 0.00% -4.23% 6.85% 50.09%315 1985 ----NANANA NA NA NA NA NA NA315 1986 6,578,252132,123165,027(32,904)-0.50% -0.50% -0.52% -0.53% -0.48% -0.48% -0.49% -0.57% 0.63% 0.65%315 1987 33,8577,80727,558(19,751)-58.34% -0.80% -0.80% -0.82% -0.83% -0.77% -0.78% -0.79% -0.86% 0.33%315 1988 19,42291589,106(88,191)-454.08% -202.60% -2.12% -2.12% -2.14% -2.15% -2.09% -2.10% -2.10% -2.16%315 1989(3,217)14,78611,3173,469-107.83% -522.81% -208.69% -2.07% -2.07% -2.09% -2.10% -2.04% -2.04% -2.05%315 1990 33,6371,1111,693(582)-1.73%9.49% -171.15%-125.52% -2.07% -2.07% -2.09% -2.10% -2.04% -2.04%315 1991 36,586-1,887(1,887)-5.16% -3.52%1.49% -100.88% -88.91% -2.09% -2.09% -2.11% -2.11% -2.06%315 1992 79,200-584(584)-0.74% -2.13% -2.04% 0.28% -53.00% -53.90% -2.07% -2.07% -2.09% -2.10%315 1993 142,5082,08919,913(17,824)-12.51% -8.30% -7.86% -7.15% -6.03% -34.27% -36.65% -2.29% -2.29% -2.30%315 1994 47,831-3,866(3,866)-8.08% -11.40% -8.26% -7.89%-7.28% -6.32%-30.75% -33.15% -2.33% -2.33%315 1995 (341,910)-4,544(4,544)1.33%2.86% 17.31% 37.06%80.22% 1363.69% 481.26% -811.03% -279.16% -2.52%315 1996 167,296-12,175(12,175)-7.28%9.57% 16.24% -244.25%-41.08% -31.08% -25.11% -23.46% -69.58% -67.81%315 1997 125,000-18,621(18,621)-14.90% -10.54% 71.23% 2199.23%-40.53% -26.20% -23.20% -20.71% -19.73% -47.27%315 1998----NANANA NA NA NA NA NA NANA315 1999----NANANA NA NA NA NA NA NANA315 2000----NANANA NA NA NA NA NA NANA315 2001----NANANA NA NA NA NA NA NANA315 2002 162,096-10,240(10,240)-6.32% -6.32% -6.32% -6.32% -6.32% -10.05% -9.03% -40.52% -30.84% -22.21%315 20034,85727,64427,974(330)-6.80% -6.33% -6.33%-6.33% -6.33% -6.33% -10.00% -9.01% -39.13% -30.14%315 2004----NANANA NA NA NA NA NA NANA315 2005 1,182,108-123,787(123,787)-10.47% -10.47% -10.46% -9.96%-9.96% -9.96% -9.96% -9.96% -10.38% -10.06%315 20066,500-985(985)-15.15% -10.50% -10.50%-10.48% -9.98% -9.98% -9.98% -9.98% -9.98% -10.40%315 20078,174-647,092(647,092)-7916.22% -4416.42% -64.49% -64.49%-64.26% -57.37% -57.37% -57.37% -57.37% -57.37%315 2008 1,063,751-18,039(18,039)-1.70% -62.05% -61.77% -34.94% -34.94% -34.88% -32.98% -32.98% -32.98% -32.98%315 20097,910-101,912(101,912)-1288.46% -11.19% -71.03% -70.70%-39.31% -39.31% -39.24% -37.05% -37.05% -37.05%315 2010---0NANANA NA NA NA NA NA NANA315 2011 528,2080 214,540(214,540)-40.62% -40.62% -59.03% -20.91%-61.04% -60.86% -39.56% -39.56% -39.50% -37.69%315 2012 78,5520 164,088(164,088)-208.89% -62.40% -62.40%-78.18%-29.71% -67.93% -67.73% -44.19% -44.19% -44.12%Appendix E-1Page 4 of 92- yr 3- yr 4- yr 5- yr 6- yr 7- yr 8- yr 9- yr 10- yrFERC Removal Net Net Net Net Net Net Net Net Net Net NetAcct ActivityRetirement Salvage Costs Salvage Salvage%Salvage%Salvage%Salvage%Salvage%Salvage%Salvage%Salvage%Salvage%Salvage%Southwestern Public Service Company - TexasRetirement and Salvage AnalysisProduction and Other Production Interim Net SalvageAccounts 311 - 346316 1977594---0.00%316 1978 13,03427,5224,15623,366179.27% 171.46%316 1979 13,5262,1721,7104623.42% 89.71% 87.75%316 19804,25916,7973,73113,066306.79% 76.06% 119.71% 117.45%316 19819,844-50(50)-0.51% 92.29% 48.78% 90.61% 89.30%316 19824,32150447(397)-9.19% -3.16% 68.49% 40.94% 81.02% 79.97%316 1983 48,0827111006111.27%0.41%0.26% 19.89% 17.11% 39.82% 39.57%316 1984 12,968480632(152)-1.17%0.75%0.09% 0.02% 16.46% 14.56% 6.85% 34.61%316 1985 46,750394843(449)-0.96% -1.01%0.01% -0.35% -0.36% 10.01% 9.37% 23.86% 23.77%316 1986 617,7786,25212,601(6,349)-1.03% -1.02% -1.03% -0.87% -0.92% -0.92% 0.84% 0.89% 3.91% 3.90%316 1987 15,8035762,214(1,638)-10.37% -1.26% -1.24%-1.24% -1.08% -1.12%-1.11% 0.61% 0.66% 3.62%316 1988 17,521185,260(5,242)-29.92% -20.65% -2.03% -1.96% -1.95% -1.74% -1.78% -1.77% -0.08% -0.02%316 1989 77,9247561,382(626)-0.80% -6.15% -6.75%-1.90% -1.84% -1.83% -1.65% -1.69% -1.68% -0.14%316 1990 153,5191,8502,376(526)-0.34% -0.50% -2.57%-3.03% -1.63% -1.60% -1.59% -1.45% -1.48% -1.48%316 1991 82,48475995(920)-1.12% -0.61% -0.66%-2.21% -2.58% -1.59% -1.56% -1.55% -1.43% -1.46%316 1992 29,819(47,361)2,334(49,695)-166.66% -45.07% -19.24% -15.06% -15.78% -15.55% -6.53% -6.28% -6.22% -5.89%316 1993 614,6296,07819,048(12,970)-2.11% -9.72% -8.75% -7.28% -6.75% -7.17% -7.22% -4.84% -4.73% -4.71%316 1994 461,98720436,959(36,755)-7.96% -4.62% -8.99% -8.44%-7.51% -7.15% -7.42% -7.45% -5.54% -5.44%316 1995 78,4825454,789(4,244)-5.41% -7.59% -4.67% -8.75% -8.25% -7.40% -7.05% -7.32% -7.35% -5.53%316 1996 40,193(946)1,073(2,018)-5.02% -5.28% -7.41% -4.68% -8.63% -8.15% -7.33% -7.00% -7.26% -7.29%316 1997 116,0223814,064(14,026)-12.09% -10.27% -8.64% -8.19% -5.34% -8.93% -8.47% -7.68% -7.36% -7.59%316 1998 38,336-3,373(3,373)-8.80% -11.27% -9.98% -8.67% -8.22% -5.44% -8.92% -8.48% -7.71% -7.39%316 1999 49,950---0.00% -3.82% -8.52% -7.94% -7.33% -7.70% -5.24% -8.61% -8.20% -7.48%316 2000----NANANA NA NA NA NA NA NANA316 2001----NANANA NA NA NA NA NA NANA316 2002 261,88123,53134,250(10,719)-4.09% -4.09% -4.09% -3.44% -4.02% -6.03% -5.95% -5.88% -6.80% -5.06%316 2003 15,93717,23117,231-0.00% -3.86% -3.86% -3.86% -3.27% -3.85% -5.83% -5.77% -5.72% -6.69%316 2004-480-480NANANA NA NA NA NA NA NANA316 2005 2,209,01223,22119,6293,5920.16%0.18%0.18% -0.27% -0.27% -0.27% -0.26% -0.39% -0.89% -0.95%316 20067,4243,6561863,47046.73%0.32%0.34% 0.34%-0.13% -0.13% -0.13% -0.12% -0.25% -0.76%316 20072069,6289,042585284.86% 53.15%0.35%0.37% 0.36% -0.10% -0.10% -0.10% -0.10% -0.23%316 2008 84,956(9,628)1,960(11,587)-13.64% -12.92% -8.14% -0.17% -0.15% -0.15% -0.55% -0.55% -0.55% -0.54%316 2009----NANANA NA NA NA NA NA NANA316 2010----NANANA NA NA NA NA NANANA316 2011 437,672-113,573(113,573)-25.95% -25.95% -25.95% -23.95%-23.83% -22.84% -4.29% -4.27% -4.25% -4.23%316 20128,547-789(789)-9.23% -25.63% -25.63%-25.63% -23.71% -23.59% -22.62% -4.31% -4.29% -4.26%Appendix E-1Page 5 of 92- yr 3- yr 4- yr 5- yr 6- yr 7- yr 8- yr 9- yr 10- yrFERC Removal Net Net Net Net Net Net Net Net Net Net NetAcct ActivityRetirement Salvage Costs Salvage Salvage%Salvage%Salvage%Salvage%Salvage%Salvage%Salvage%Salvage%Salvage%Salvage%Southwestern Public Service Company - TexasRetirement and Salvage AnalysisProduction and Other Production Interim Net SalvageAccounts 311 - 346341 1978 25,0253384,480(4,142)-16.55%341 1979 ----NANA341 1980----NANANA341 1981----NANANA NA341 19823,311---0.00%0.00%0.00% 0.00% -14.62%341 1983----NANANA NA NA NA341 1984----NANANA NA NA NA NA341 1985----NANANA NA NA NA 6.85% NA341 1986 128,0155711,524(953)-0.74% -0.74% -0.74% -0.74% -0.73% -0.73% -0.73% -0.73% -3.26%341 19879,203-2,625(2,625)-28.52% -2.61% -2.61% -2.61% -2.61% -2.55% -2.55% -2.55% -2.55% -4.66%341 1988--916(916)NANANA NA NA NA NA NA NANA341 1989--2,270(2,270)NANANA NA NA NA NA NA NANA341 1990-2,017-2,017NANANA NA NA NA NA NA NANA341 1991 54,882-14,007(14,007)-25.52% -21.85% -25.98% -27.65% -27.78% -9.76% -9.76% -9.76% -9.76% -9.60%341 1992-17,931-17,931NANANA NA NA NA NA NA NANA341 1993----NANANA NA NA NA NA NA NANA341 1994----NANANA NA NA NA NA NA NANA341 1995 25,000-1,700(1,700)-6.80% -6.80% -6.80% 64.92% 2.78% 5.31% 2.47%1.32% -1.76% -1.16%341 19962,500-300(300)-12.00% -7.27%-7.27% -7.27% 57.93% 2.34% 4.78% 2.03% 0.92% -2.04%341 1997----NANANA NA NA NANA NA NANA341 1998----NANANA NA NA NA NA NA NANA341 1999----NANANA NA NA NA NA NA NANA341 2000----NANANA NA NA NA NA NA NANA341 2001----NANANA NA NA NA NA NA NANA341 2002----NANANA NA NA NA NA NA NANA341 20034,5005,6006,966(1,366)-30.35% -30.35% -30.35% -30.35% -30.35% -30.35% -30.35% -23.79% -10.52% -10.52%341 2004----NANANA NA NA NA NA NA NANA341 20053,000-27,480(27,480)-916.01% -916.01% -384.61% -384.61%-384.61% -384.61% -384.61% -384.61% -384.61% -291.46%341 2006----NANANA NA NA NA NA NA NANA341 2007----NANANA NA NA NA NA NA NANA341 20082,773---0.00%0.00%0.00% -476.04% -476.04% -280.80% -280.80% -280.80% -280.80% -280.80%341 2009----NANANA NA NA NA NA NA NANA341 2010----NANANA NA NA NA NA NA NANA341 2011 236,807---0.00%0.00%0.00% 0.00% 0.00% 0.00% -11.33% -11.33% -11.67% -11.67%341 2012----NA0.00%0.00% 0.00% 0.00% 0.00% 0.00% -11.33% -11.33% -11.67%Appendix E-1Page 6 of 92- yr 3- yr 4- yr 5- yr 6- yr 7- yr 8- yr 9- yr 10- yrFERC Removal Net Net Net Net Net Net Net Net Net Net NetAcct ActivityRetirement Salvage Costs Salvage Salvage%Salvage%Salvage%Salvage%Salvage%Salvage%Salvage%Salvage%Salvage%Salvage%Southwestern Public Service Company - TexasRetirement and Salvage AnalysisProduction and Other Production Interim Net SalvageAccounts 311 - 346342 1978 63,1399,2621,4567,80612.36%342 1979 ----NANA342 1980----NANANA342 1981----NANANA NA342 1982----NANANA NA NA342 1983----NANANA NA NA NA342 1984----NANANA NA NA NA NA342 1985----NANANA NA NA NA 6.85% NA342 1986 383,9392,0546,708(4,654)-1.21% -1.21% -1.21% -1.21% -1.21% -1.21% -1.21% -1.21% 0.71%342 1987 22,865-6,521(6,521)-28.52% -2.75% -2.75% -2.75% -2.75% -2.75% -2.75% -2.75% -2.75% -0.72%342 1988----NANANA NA NA NA NA NA NANA342 1989----NANANA NA NA NA NA NA NANA342 1990----NANANA NA NA NA NA NA NANA342 1991----NANANA NA NA NA NA NA NANA342 1992----NANANA NA NA NA NA NA NANA342 1993----NANANA NA NA NA NA NA NANA342 1994----NANANA NA NA NA NA NA NANA342 1995 (383,939)---0.00%0.00%0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 1.81% -48.87%342 1996----NANANA NA NA NA NA NA NANA342 1997----NANANA NA NA NA NANA NANA342 1998----NANANA NA NA NA NA NA NANA342 1999----NANANA NA NA NA NA NA NANA342 2000----NANANA NA NA NA NA NA NANA342 2001----NANANA NA NA NA NA NA NANA342 20026,000---0.00%0.00%0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%342 2003----NANANA NA NA NA NA NA NANA342 2004----NANANA NA NA NA NA NA NANA342 20053,8116,21484,748(78,535)-2060.80% -2060.80% -2060.80% -800.48%-800.48% -800.48% -800.48% -800.48% -800.48% -800.48%342 2006----NANANA NA NA NA NA NA NANA342 2007----NANANA NA NA NA NA NA NANA342 2008----NANANA NA NA NA NA NA NANA342 2009----NANANA NA NA NA NA NA NANA342 2010----NANANA NA NA NA NA NA NANA342 20117,622---0.00%0.00%0.00% 0.00% 0.00% 0.00% -686.93% -686.93% -686.93% -450.50%342 2012----NA0.00%0.00% 0.00% 0.00% 0.00% 0.00% -686.93% -686.93% -686.93%Appendix E-1Page 7 of 92- yr 3- yr 4- yr 5- yr 6- yr 7- yr 8- yr 9- yr 10- yrFERC Removal Net Net Net Net Net Net Net Net Net Net NetAcct ActivityRetirement Salvage Costs Salvage Salvage%Salvage%Salvage%Salvage%Salvage%Salvage%Salvage%Salvage%Salvage%Salvage%Southwestern Public Service Company - TexasRetirement and Salvage AnalysisProduction and Other Production Interim Net SalvageAccounts 311 - 346343 1978 77,8401,05113,932(12,881)-16.55%343 1979 ----NANA343 1980----NANANA343 1981----NANANA NA343 1982----NANANA NA NA343 1983----NANANA NA NA NA343 1984----NANANA NA NA NA NA343 1985----NANANA NA NA NA 6.85% NA343 1986 5,391,84326,96282,432(55,470)-1.03% -1.03% -1.03% -1.03% -1.03% -1.03% -1.03% -1.03% -1.25%343 1987 93,748-26,746(26,746)-28.53% -1.50% -1.50% -1.50% -1.50% -1.50% -1.50% -1.50% -1.50% -1.71%343 1988--15,134(15,134)NANANA NA NA NA NA NA NANA343 1989--37,508(37,508)NANANA NA NA NA NA NA NANA343 1990-21,00011,3999,601NANANA NA NA NA NA NA NANA343 19914,00054,0002,47451,5261288.15% 1528.18% 590.48% 212.13% -18.68% -1.34% -1.34% -1.34% -1.34% -1.34%343 1992----NANANA NA NA NA NA NA NANA343 1993----NANANA NA NA NA NA NA NANA343 1994----NANANA NA NA NA NA NA NANA343 1995 (2,728,291)---0.00%0.00%0.00% 0.00% -1.89% -2.24% -0.87% -0.31% 0.69% -2.67%343 1996 75,000-38,259(38,259)-51.01%1.44%1.44% 1.44% 1.44% -0.50% -0.86% 0.55% 1.12% 2.21%343 1997----NANANA NA NA NANA NA NANA343 1998----NANANA NA NA NA NA NA NANA343 1999----NANANA NA NA NA NA NA NANA343 2000----NANANA NA NA NA NA NA NANA343 2001----NANANA NA NA NA NA NA NANA343 2002----NANANA NA NA NA NA NA NANA343 2003----NANANA NA NA NA NA NA NANA343 2004----NANANA NA NA NA NA NA NANA343 2005 270,549127,08152,80874,27327.45% 27.45% 27.45% 27.45% 27.45% 27.45% 27.45% 27.45% 27.45% 10.42%343 2006----NANANA NA NA NA NA NA NANA343 2007--696(696)NANANA NA NA NA NA NA NANA343 2008 10,564---0.00% -6.58%-6.58% 26.17% 26.17% 26.17% 26.17% 26.17% 26.17% 26.17%343 2009----NANANA NA NA NA NA NA NANA343 2010----NANANA NA NA NA NA NA NANA343 2011 13,392-1,725(1,725)-12.88% -12.88% -12.88%-7.20% -10.11% -10.11% 24.40% 24.40% 24.40% 24.40%343 2012 463,594-17,812(17,812)-3.84% -4.10% -4.10% -4.10% -4.01% -4.15% -4.15% 7.13% 7.13% 7.13%Appendix E-1Page 8 of 92- yr 3- yr 4- yr 5- yr 6- yr 7- yr 8- yr 9- yr 10- yrFERC Removal Net Net Net Net Net Net Net Net Net Net NetAcct ActivityRetirement Salvage Costs Salvage Salvage%Salvage%Salvage%Salvage%Salvage%Salvage%Salvage%Salvage%Salvage%Salvage%Southwestern Public Service Company - TexasRetirement and Salvage AnalysisProduction and Other Production Interim Net SalvageAccounts 311 - 346344 1983 10,00080-800.80%344 1984 ----NANA344 1985----NANANA344 1986 2,701,2124,96115,495(10,534)-0.39% -0.39% -0.39% -0.39%344 1987-250,91278,370172,542NANANA NA NA344 1988--7,738(7,738)NANANA NA NA NA344 1989 11,300-19,171(19,171)-169.65% -238.13% 1288.79% 4.98% 4.98% 4.98% 4.97%344 1990 (1,100,945)-9,954(9,954)0.90%2.67%3.38% -12.45% 7.77% 7.77% 6.85% 7.72%344 19915,900-10,202(10,202)-172.92%1.84%3.63% 4.34% -11.58% 7.11% 7.11% 7.11% 7.07%344 1992 840,1541,27412,479(11,205)-1.33% -2.53% 12.30%20.74% 23.92% -46.91% 4.22% 4.22% 4.22% 4.21%344 1993 386,000-484,976(484,976)-125.64% -40.47% -41.10% -393.82% -376.04% -381.47% -260.31% -13.41% -13.41% -13.41%344 1994 30,00025,00016,2388,76229.21% -114.47% -38.80% -39.43% -315.05% -305.52% -310.01% -209.93% -12.96% -12.96%344 1995 (443,930)2,58111,739(9,157)2.06%0.10% 1737.82% -61.14% -61.94% 182.71% 197.37%200.22% 136.67% -15.71%344 1996 15,650-6,621(6,621)-42.31%3.68%1.76%4006.47% -60.78% -61.58% 195.89% 212.03% 215.05% 147.62%344 1997----NANANA NA NA NA NA NA NANA344 1998 471,41512,3962,8439,5532.03%2.03%0.60% -14.43% 3.47% -105.08% -37.99% -38.60% -251.56% -247.27%344 1999----NANANA NA NA NA NA NA NANA344 2000----NANANA NA NA NA NA NA NANA344 2001----NANANA NA NANANA NA NANA344 2002 223,00020,52120,521-0.00%0.00%0.00% 0.00% 1.38% 1.38% 0.41% -2.34% 0.86% -70.72%344 2003 50,000---0.00%0.00%0.00% 0.00% 0.00% 1.28% 1.28% 0.39% -1.97% 0.73%344 2004----NANANA NA NA NA NA NA NANA344 2005 2,115,028270,91950,258220,66010.43% 10.43% 10.19% 9.24% 9.24% 9.24% 9.24% 8.05% 8.05% 7.78%344 2006----NANANA NA NA NA NA NA NANA344 2007--8,082(8,082)NANANA NA NA NA NA NA NANA344 2008 129,377-4,217(4,217)-3.26% -9.51% -9.51% 9.28% 9.28% 9.08% 8.28% 8.28% 8.28% 8.28%344 2009 293,404-56,942(56,942)-19.41% -14.47% -16.38% -16.38% 5.97% 5.97%5.85% 5.39% 5.39% 5.39%344 2010----NANANA NA NA NA NA NA NANA344 2011 2,140,905-12,442(12,442)-0.58% -0.58% -2.85%-2.87% -3.19% -3.19%2.97% 2.97% 2.94% 2.81%344 20126,566-460(460)-7.01% -0.60% -0.60% -2.86% -2.88% -3.20% -3.20% 2.96% 2.96% 2.93%Appendix E-1Page 9 of 92- yr 3- yr 4- yr 5- yr 6- yr 7- yr 8- yr 9- yr 10- yrFERC Removal Net Net Net Net Net Net Net Net Net Net NetAcct ActivityRetirement Salvage Costs Salvage Salvage%Salvage%Salvage%Salvage%Salvage%Salvage%Salvage%Salvage%Salvage%Salvage%Southwestern Public Service Company - TexasRetirement and Salvage AnalysisProduction and Other Production Interim Net SalvageAccounts 311 - 346345 1978 43,8735937,853(7,260)-16.55%345 1979 ----NANA345 1980----NANANA345 1981----NANANA NA345 1982----NANANA NA NA345 1983----NANANA NA NA NA345 1984----NANANA NA NA NA NA345 1985----NANANA NA NA NA 6.85% NA345 1986 506,6725,0049,879(4,875)-0.96% -0.96% -0.96%-0.96% -0.96% -0.96% -0.96% -0.96% -2.20%345 1987----NANANA NA NA NA NA NA NANA345 1988--2,017(2,017)NANANA NA NA NA NA NA NANA345 1989--4,998(4,998)NANANA NA NA NA NA NA NANA345 1990----NANANA NA NA NA NA NA NANA345 1991 201,985-51,667(51,667)-25.58% -25.58% -28.05% -29.05% -29.05% -8.97% -8.97% -8.97% -8.97% -8.97%345 1992-65,795-65,795NANANA NA NA NA NA NA NANA345 1993 47,787-4,188(4,188)-8.76% 128.92%3.98%3.98% 1.98% 1.17% 1.17% -0.26% -0.26% -0.26%345 1994----NANANA NA NA NA NA NA NANA345 1995 (168,617)10,629-10,629-6.30% -6.30% -5.33%-59.78% 25.34% 25.34% 19.19% 16.70% 16.70% 1.48%345 1996----NANANA NA NA NA NA NA NANA345 1997----NANANA NA NA NANA NA NANA345 1998----NANANA NA NA NA NA NA NANA345 1999----NANANA NA NA NA NA NA NANA345 2000----NANANA NA NA NA NA NA NANA345 2001----NANANA NA NA NA NA NA NANA345 2002 47,102-1,460(1,460)-3.10% -3.10% -3.10% -3.10% -3.10% -3.10% -3.10% -7.55% -7.55% -6.76%345 2003----NANANA NA NA NA NA NA NANA345 2004----NANANA NA NA NA NA NA NANA345 2005 106,123-40,271(40,271)-37.95% -37.95% -37.95% -27.23% -27.23% -27.23% -27.23% -27.23% -27.23% -27.23%345 2006----NANANA NA NA NA NA NA NANA345 2007--17,699(17,699)NANANA NA NA NA NA NA NANA345 2008 65,766---0.00% -26.91% -26.91% -33.73% -33.73% -33.73% -27.14% -27.14% -27.14% -27.14%345 2009----NANANA NA NA NA NA NA NANA345 2010----NANANA NA NA NA NA NA NANA345 2011 713,067-3,076(3,076)-0.43% -0.43% -0.43% -0.39% -2.67% -2.67% -6.90% -6.90% -6.90% -6.71%345 2012 26,115-1,309(1,309)-5.01% -0.59% -0.59% -0.59% -0.54% -2.74% -2.74% -6.84% -6.84% -6.84%346 1986 133,1197022,266(1,564)-1.17%346 1987----NANA346 1988--77(77)NANANA346 1989--192(192)NANANA NA346 1990----NANANA NA NA346 1991----NANANA NA NA NA346 1992----NANANA NA NA NA NA346 1993----NANANA NA NA NA 6.85% NA346 1994----NANANA NA NA NA NA NA NA346 1995 (118,750)---0.00%0.00%0.00% 0.00% 0.00% 0.00% 0.16% 0.23% 0.23% -12.76%346 1996----NANANA NA NA NA NA NA NANA346 1997----NANANA NA NA NA NA NA NANA346 1998----NANANA NA NA NA NA NA NANA346 1999----NANANA NA NA NA NA NA NANA346 2000----NANANA NA NA NA NA NA NANA346 2001----NANANA NA NA NA NA NA NANA346 2002500---0.00%0.00%0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%346 2003----NANANA NA NA NA NA NA NANA346 2004----NANANA NA NA NA NA NA NANA346 20057,944---0.00%0.00%0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%346 2006----NANANA NA NA NA NA NA NANA346 2007----NANANA NA NA NA NA NANANA346 2008----NANANA NA NA NA NA NA NANA346 2009----NANANA NA NA NA NA NA NANA346 2010----NANANA NA NA NA NA NA NANA346 20115,459-307(307)-5.62% -5.62% -5.62%-5.62% -5.62% -5.62% -2.29% -2.29% -2.29% -2.21%346 2012----NA -5.62% -5.62% -5.62% -5.62% -5.62% -5.62% -2.29% -2.29% -2.29%Appendix E-2Page 1 of 29Transactional2- yr3- yr4- yr5- yr6- yr7- yr8- yr9- yr 10- yrTransaction HistoryRemovalNetNet Net Net Net Net Net Net Net Net NetAcctYearRetirements SalvageCostSalvageSalv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. %3501995‐‐‐0 NA NA3501996‐‐‐0 NA NA NA3501997‐‐‐0 NA NA NA NA3501998‐‐‐0 NA NA NA NA NA3501999‐‐‐0 NA NA NA NA NA NA3502000‐‐‐0 NA NA NA NA NA NA NA3502001‐‐‐0 NA NA NA NA NA NA NA NA3502002‐‐‐0 NA NA NA NA NA NA NA NA NA3502003‐‐‐0 NA NA NA NA NA NA NA NA NA NA3502004‐‐‐0 NA NA NA NA NA NA NA NA NA NA3502005‐‐‐0 NA NA NA NA NA NA NA NA NA NA3502006‐‐‐0 NA NA NA NA NA NA NA NA NA NA3502007‐‐‐0 NA NA NA NA NA NA NA NA NA NA3502008‐‐‐0 NA NA NA NA NA NA NA NA NA NA3502009‐‐‐0 NA NA NA NA NA NA NA NA NA NA350201026,242‐5(5)‐0.02%‐0.02%‐0.02%‐0.02%‐0.02%‐0.02%‐0.02%‐0.02%‐0.02%‐0.02%350201111,387‐‐00.00%‐0.01%‐0.01%‐0.01%‐0.01%‐0.01%‐0.01%‐0.01%‐0.01%‐0.01%3502012‐‐‐0NA 0.00%‐0.01%‐0.01%‐0.01%‐0.01%‐0.01%‐0.01%‐0.01%‐0.01%3521985‐738402336 NA35219865,5423,8925,350(1,458)‐26.31%‐20.25%3521987‐‐0 NA‐26.31%‐20.25%352198814,3581,1092,983(1,874)‐13.05%‐13.05%‐16.74%‐15.06%352198914,1283,39519,942(16,547)‐117.12%‐64.67%‐64.67%‐58.42%‐57.43%35219905,206394,790(4,751)‐91.26%‐110.16%‐68.78%‐68.78%‐62.78%‐61.92%35219914,5381864,604(4,418)‐97.36%‐94.10%‐107.72%‐72.17%‐72.17%‐66.36%‐65.59%35219927,7088216,187(5,366)‐69.62%‐79.90%‐83.29%‐98.42%‐71.74%‐71.74%‐66.85%‐66.20%35219932,353584,972(4,914)‐208.84%‐102.18%‐100.68%‐98.20%‐106.08%‐78.42%‐78.42%‐73.06%‐72.43%35219941,29616163(147)‐11.34%‐138.70%‐91.81%‐93.39%‐92.87%‐102.59%‐76.67%‐76.67%‐71.60%‐71.00%35219957,1285,9691,5324,437 62.25% 50.93%‐5.79%‐32.40%‐45.21%‐53.70%‐74.85%‐59.21%‐59.21%‐56.28%35219966,1073,23210,574(7,342)‐120.23%‐21.95%‐21.00%‐47.18%‐54.21%‐60.93%‐65.53%‐80.57%‐65.14%‐65.14%3521997153‐‐00.00%‐117.29%‐21.70%‐20.78%‐46.76%‐53.88%‐60.62%‐65.24%‐80.32%‐64.98%352199874‐‐00.00% 0.00%‐115.91%‐21.58%‐20.68%‐46.55%‐53.72%‐60.46%‐65.10%‐80.19%35219992,452‐‐00.00% 0.00% 0.00%‐83.56%‐18.25%‐17.73%‐40.72%‐48.89%‐55.80%‐60.79%3522000408‐‐00.00% 0.00% 0.00% 0.00%‐79.85%‐17.80%‐17.32%‐39.89%‐48.17%‐55.09%3522001655‐‐00.00% 0.00% 0.00% 0.00% 0.00%‐74.54%‐17.11%‐16.70%‐38.62%‐47.05%352200216,81911,57836,493(24,915)‐148.13%‐142.58%‐139.33%‐122.53%‐122.08%‐121.17%‐120.95%‐82.31%‐79.69%‐87.81%3522003456‐3,290(3,290)‐722.25%‐163.27%‐157.31%‐153.81%‐135.67%‐135.18%‐134.20%‐131.05%‐90.83%‐87.93%3522004163‐‐00.00%‐531.69%‐161.74%‐155.89%‐152.45%‐134.61%‐134.13%‐133.16%‐130.27%‐90.39%35220052,130‐500(500)‐23.46%‐21.79%‐137.89%‐146.70%‐141.94%‐139.13%‐124.35%‐123.96%‐123.14%‐122.54%3522006‐‐864(864)NA‐64.06%‐59.50%‐169.35%‐151.11%‐146.22%‐143.33%‐128.10%‐127.69%‐126.85%3522007‐‐481(481)NANA‐86.65%‐80.48%‐186.85%‐153.57%‐148.60%‐145.66%‐130.18%‐129.77%352200817,315‐63(63)‐0.37%‐3.14%‐8.14%‐9.82%‐9.73%‐25.91%‐81.65%‐80.22%‐79.36%‐74.54%352200914,160‐1,278(1,278)‐9.02%‐4.26%‐5.79%‐8.54%‐9.48%‐9.44%‐18.92%‐61.50%‐60.72%‐60.25%35220105,187‐1,753(1,753)‐33.80%‐15.67%‐8.44%‐9.75%‐12.11%‐12.73%‐12.68%‐20.88%‐58.94%‐58.27%35220114,070‐1,852(1,852)‐45.50%‐38.94%‐20.85%‐12.14%‐13.32%‐15.45%‐15.85%‐15.78%‐23.19%‐58.04%352201262,481‐7,028(7,028)‐11.25%‐13.34%‐14.82%‐13.87%‐11.60%‐12.07%‐12.90%‐13.12%‐13.10%‐16.15%Southwestern Public Service Company - TexasRetirement and Salvage AnalysisAppendix E-2Page 2 of 29Transactional2- yr3- yr4- yr5- yr6- yr7- yr8- yr9- yr 10- yrTransaction HistoryRemovalNetNet Net Net Net Net Net Net Net Net NetAcctYearRetirements SalvageCostSalvageSalv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. %Southwestern Public Service Company - TexasRetirement and Salvage Analysis353196886,64520,2896,83513,454 15.53%353196935,25112,6042,04110,563 29.97% 19.70%353197047,23913,4543,7059,749 20.64% 24.62% 19.96%353197135,33310,1624,9075,255 14.87% 18.17% 21.70% 19.08%3531972130,7318,3268,661(335)‐0.26% 2.96% 6.88% 10.15% 11.54%353197344,6523,2401,1352,105 4.71% 1.01% 3.33% 6.50% 9.32% 10.74%353197479,3969,7767,9861,790 2.25% 3.14% 1.40%3.04% 5.50% 7.82% 9.27%353197592,4889,3706,6442,726 2.95% 2.63% 3.06% 1.81% 3.02% 4.95% 6.85% 8.21%3531976100,8997,27412,539(5,265)‐5.22%‐1.31%‐0.27% 0.43% 0.23% 1.30% 3.02% 4.70% 6.14%3531977135,95625,42314,35811,065 8.14% 2.45% 2.59% 2.52% 2.74% 2.07% 2.80% 4.06% 5.36% 6.48%353197871,82120,21911,2848,935 12.44% 9.63% 4.77% 4.35% 4.01% 4.07% 3.20% 3.80% 4.88% 6.02%3531979218,85541,3818,55532,826 15.00% 14.37% 12.38% 9.02% 8.11% 7.45% 7.28% 6.16% 6.49% 7.19%353198027,6009,4001,6257,775 28.17% 16.47% 15.56% 13.34% 9.97% 8.97% 8.23% 8.03% 6.83% 7.13%3531981306,43411,81514,907(3,092)‐1.01% 1.40% 6.78% 7.43% 7.56% 6.06% 5.76% 5.49% 5.46% 4.84%3531982121,1988986,437(5,539)‐4.57%‐2.02%‐0.19% 4.74% 5.48% 5.89% 4.75% 4.60% 4.44% 4.45%353198392,19734,58632,1612,425 2.63%‐1.46%‐1.19% 0.29% 4.49% 5.17% 5.58% 4.57% 4.44% 4.30%3531984326,20116,91577,709(60,794)‐18.64%‐13.95%‐11.84%‐7.92%‐6.78%‐2.42%‐1.50%‐0.49%‐0.83%‐0.60%3531985213,44025,88325,201682 0.32%‐11.14%‐9.13%‐8.40%‐6.26%‐5.39%‐1.97%‐1.22%‐0.38%‐0.68%3531986431,52416,35043,822(27,472)‐6.37%‐4.15%‐9.02%‐8.01%‐7.66%‐6.29%‐5.66%‐3.06%‐2.45%‐1.71%3531987361,122183,38345,115138,268 38.29% 13.98% 11.08% 3.80% 3.73% 3.08% 2.40% 2.78% 4.05% 4.33%3531988183,48512,71329,797(17,084)‐9.31% 22.25% 9.60% 7.94% 2.22% 2.24% 1.76% 1.35% 1.70% 2.98%35319892,638,9351,452,462205,6771,246,785 47.25% 43.57% 42.97% 37.08% 35.03% 30.82% 30.21% 29.24% 27.26% 27.26%3531990519,391146,93490,98655,948 10.77% 41.25% 38.47% 38.45% 33.78% 32.13% 28.59% 28.09% 27.28% 25.61%3531991780,433137,725149,752(12,027)‐1.54% 3.38% 32.77% 30.90% 31.49%28.17% 27.01% 24.28% 23.92% 23.31%3531992988,831151,81065,70686,104 8.71% 4.19% 5.68% 27.94% 26.60% 27.37% 24.91% 24.05% 21.89% 21.62%3531993550,66825,254123,495(98,241)‐17.84%‐0.79%‐1.04% 1.12% 23.34% 22.28%23.24% 21.26% 20.59% 18.76%3531994468,19272,91653,09319,823 4.23%‐7.70% 0.38%‐0.16% 1.56% 21.83% 20.90% 21.87% 20.11% 19.52%3531995548,60721,96987,177(65,208)‐11.89%‐4.46%‐9.16%‐2.25%‐2.08%‐0.35% 18.99% 18.21% 19.24% 17.76%3531996786,12034,269105,493(71,224)‐9.06%‐10.22%‐6.47%‐9.13%‐3.85%‐3.41%‐1.83% 15.96% 15.34% 16.40%3531997527,061639,69290,871548,821 104.13% 36.37% 22.15% 18.55% 11.59% 10.86% 8.78% 8.98% 21.91% 21.19%3531998182,513‐7,002(7,002)‐3.84% 76.36% 31.46% 19.83% 16.92% 10.67% 10.19% 8.30% 8.54% 21.32%3531999810,529‐‐00.00%‐0.71% 35.64% 20.41% 14.20% 12.80% 8.44% 8.50% 7.11% 7.42%353200072,863‐‐00.00% 0.00%‐0.66% 34.01% 19.78% 13.85% 12.52% 8.28% 8.37% 7.02%3532001177,190‐4,845(4,845)‐2.73%‐1.94%‐0.46%‐0.95% 30.33% 18.22% 12.90% 11.76% 7.81% 7.98%3532002806,0301,000,1311,281,171(281,040)‐34.87%‐29.08%‐27.07%‐15.32%‐14.29% 9.93% 5.49% 3.06% 3.18% 0.83%3532003264,550‐11,888(11,888)‐4.49%‐27.36%‐23.86%‐22.55%‐13.97%‐13.17% 8.59% 4.77% 2.58% 2.74%35320046,904(110)‐(110)‐1.59%‐4.42%‐27.20%‐23.74%‐22.44%‐13.93%‐13.14% 8.57% 4.75% 2.57%35320051,513,619‐190,071(190,071)‐12.56%‐12.51%‐11.32%‐18.64%‐17.63%‐17.17%‐13.36%‐12.91% 1.24%‐0.34%3532006139,000‐65,999(65,999)‐47.48%‐15.49%‐15.44%‐13.93%‐20.11%‐19.05%‐18.59%‐14.61%‐14.12%‐0.27%35320071,357,71159,125308,598(249,473)‐18.37%‐21.08%‐16.79%‐16.76%‐15.77%‐19.54%‐18.84%‐18.52%‐15.61%‐15.20%35320081,960,12958,714218,448(159,734)‐8.15%‐12.33%‐13.75%‐13.38%‐13.37%‐12.92%‐15.85%‐15.47%‐15.29%‐13.55%3532009841,086144,514290,088(145,574)‐17.31%‐10.90%‐13.34%‐14.44%‐13.95%‐13.94%‐13.53%‐16.02%‐15.69%‐15.53%35320102,382,46249,888552,620(502,732)‐21.10%‐20.11%‐15.59%‐16.17%‐16.82%‐16.03%‐16.02%‐15.66%‐17.33%‐17.05%35320111,919,968169,918696,612(526,695)‐27.43%‐23.93%‐22.84%‐18.79%‐18.72%‐19.19%‐18.20%‐18.18%‐17.84%‐19.06%35320123,275,741103,094757,359(654,265)‐19.97%‐22.73%‐22.22%‐21.73%‐19.16%‐19.07%‐19.40%‐18.63%‐18.62%‐18.35%Appendix E-2Page 3 of 29Transactional2- yr3- yr4- yr5- yr6- yr7- yr8- yr9- yr 10- yrTransaction HistoryRemovalNetNet Net Net Net Net Net Net Net Net NetAcctYearRetirements SalvageCostSalvageSalv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. %Southwestern Public Service Company - TexasRetirement and Salvage Analysis354198950,44033,81527,8455,97011.84%3541990‐‐‐0NA 11.84%3541991‐‐‐0NANA 11.84%3541992‐‐‐0NANANA 11.84%3541993‐‐‐0NANANANA 11.84%3541994‐‐‐0NANANANANA 11.84%3541995‐‐‐0NANANANANANA 11.84%3541996‐‐‐0NANANANANANANA 11.84%3541997‐‐‐0NANANANANANANANA 11.84%3541998‐‐‐0NANANANANANANANANA 11.84%3541999‐‐‐0 NA NA NA NA NA NA NA NA NA NA3542000‐‐‐0 NA NA NA NA NA NA NA NA NA NA3542001‐‐‐0 NA NA NA NA NA NA NA NA NA NA3542002‐‐‐0 NA NA NA NA NA NA NA NA NA NA3542003‐‐‐0 NA NA NA NA NA NA NA NA NA NA3542004‐‐‐0 NA NA NA NA NA NA NA NA NA NA3542005‐‐‐0 NA NA NA NA NA NA NA NA NA NA3542006‐‐‐0 NA NA NA NA NA NA NA NA NA NA3542007‐‐‐0 NA NA NA NA NA NA NA NA NA NA3542008‐‐‐0 NA NA NA NA NA NA NA NA NA NA3542009‐‐‐0 NA NA NA NA NA NA NA NA NA NA3542010‐‐‐0 NA NA NA NA NA NA NA NA NA NA3542011‐‐‐0 NA NA NA NA NA NA NA NA NA NA3542012‐‐‐0 NA NA NA NA NA NA NA NA NA NAAppendix E-2Page 4 of 29Transactional2- yr3- yr4- yr5- yr6- yr7- yr8- yr9- yr 10- yrTransaction HistoryRemovalNetNet Net Net Net Net Net Net Net Net NetAcctYearRetirements SalvageCostSalvageSalv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. %Southwestern Public Service Company - TexasRetirement and Salvage Analysis3551968239,40970,83339,22331,610 13.20%3551969127,36440,8798,48532,394 25.43% 17.45%3551970211,94328,01023,1454,865 2.30% 10.98% 11.90%355197197,81518,63615,2473,389 3.46% 2.66% 9.30% 10.68%3551972133,40951,43320,36431,069 23.29% 14.90% 8.87% 12.57% 12.76%355197384,30140,26315,99624,267 28.79% 25.42% 18.61% 12.06% 14.66% 14.27%355197455,90219,46013,0196,441 11.52% 21.90% 22.58% 17.54% 12.00% 14.41% 14.11%3551975151,01561,64725,49336,154 23.94% 20.59% 22.96% 23.06% 19.39% 14.46% 16.08% 15.46%3551976168,59112,6897,8284,861 2.88% 12.83% 12.64% 15.60% 17.33% 15.37% 12.30% 13.92% 13.79%3551977113,55095,44035,53559,905 52.76% 22.96% 23.30% 21.95% 22.96% 23.02% 20.64% 16.82% 17.78% 16.99%3551978100,96873,45613,13560,321 59.74% 56.04% 32.65% 30.19% 28.42% 28.47% 27.61% 25.00% 20.70% 21.18%3551979121,194107,28931,84975,440 62.25% 61.11% 58.28% 39.76% 36.12% 34.18% 33.61% 32.13% 29.40% 24.76%3551980139,13270,40521,48348,922 35.16% 47.77% 51.12% 51.51% 38.77% 35.95% 34.34% 33.84% 32.52% 30.09%3551981289,903184,35974,199110,160 38.00% 37.08% 42.62% 45.28% 46.39% 38.53% 36.50% 35.27% 34.83% 33.69%3551982287,51833,74820,26113,487 4.69% 21.41% 24.08% 29.60% 32.85% 34.99% 30.56% 29.83% 29.11% 29.10%3551983285,090382,891185,184197,707 69.35% 36.88% 37.26% 36.97% 39.70% 41.35% 42.32% 37.90% 36.63% 35.81%3551984164,833193,221308,297(115,076)‐69.81% 18.37% 13.03% 20.08% 21.88% 25.68% 28.15% 30.01% 27.28% 27.00%3551985135,862100,863145,791(44,928)‐33.07%‐53.21% 6.44% 5.86% 13.87% 16.15% 20.07% 22.70% 24.78% 22.74%3551986167,695127,397175,103(47,706)‐28.45%‐30.52%‐44.35%‐1.33% 0.33% 8.54% 11.06% 14.96% 17.63% 19.84%355198746,5456,4538,097(1,644)‐3.53%‐23.03%‐26.93%‐40.66%‐1.46% 0.17% 8.13%10.61% 14.43% 17.06%3551988154,31777,971140,044(62,073)‐40.22%‐31.72%‐30.23%‐31.00%‐40.56%‐7.72%‐4.85% 3.26% 5.92% 9.73%3551989972,385154,006494,593(340,587)‐35.03%‐35.74%‐34.46%‐33.71%‐33.65%‐37.28%‐21.50%‐18.10%‐11.61%‐9.15%3551990430,91960,191282,633(222,442)‐51.62%‐40.12%‐40.13%‐39.07%‐38.06%‐37.71%‐40.26%‐27.01%‐23.56%‐17.48%3551991298,79725,477243,634(218,157)‐73.01%‐60.38%‐45.90%‐45.42%‐44.40%‐43.11%‐42.49%‐44.39%‐32.18%‐28.58%3551992308,42240,447156,975(116,528)‐37.78%‐55.12%‐53.67%‐44.65%‐44.34%‐43.48%‐42.42%‐41.91%‐43.63%‐32.76%3551993179,51125,059151,133(126,074)‐70.23%‐49.72%‐58.57%‐56.11%‐46.75%‐46.32%‐45.49%‐44.37%‐43.80%‐45.30%355199469,59718,388131,091(112,703)‐161.94%‐95.85%‐63.73%‐66.97%‐61.83%‐50.30%‐49.65%‐48.78%‐47.48%‐46.77%3551995812,480142,498636,426(493,928)‐60.79%‐68.77%‐69.02%‐61.99%‐63.96%‐61.43%‐53.07%‐52.46%‐51.76%‐50.63%3551996310,91949,989346,464(296,476)‐95.35%‐70.36%‐75.70%‐74.99%‐68.16%‐68.89%‐65.80%‐56.96%‐56.23%‐55.54%3551997101,14611,252167,157(155,904)‐154.14%‐109.78%‐77.28%‐81.83%‐80.42%‐73.04%‐73.04%‐69.36%‐59.78%‐58.95%35519981,7182503,316(3,066)‐178.42%‐154.54%‐110.07%‐77.42%‐81.96%‐80.53%‐73.14%‐73.12%‐69.44%‐59.84%3551999244,870‐‐00.00%‐1.24%‐45.72%‐69.15%‐64.53%‐68.93%‐69.07%‐64.31%‐65.43%‐63.27%3552000663‐‐00.00% 0.00%‐1.24%‐45.63%‐69.08%‐64.50%‐68.90%‐69.04%‐64.29%‐65.41%35520014,12346,67864,419(17,741)‐430.28%‐370.69%‐7.11%‐8.28%‐50.13%‐71.32%‐65.53%‐69.87%‐69.91%‐65.03%3552002107,543352,912898,464(545,552)‐507.29%‐504.44%‐501.47%‐157.70%‐157.80%‐156.99%‐132.14%‐95.53%‐98.32%‐95.57%3552003682,368228,716750,264(521,548)‐76.43%‐135.09%‐136.62%‐136.51%‐104.36%‐104.48%‐108.87%‐105.98%‐89.78%‐91.93%355200448,5322,1736,120(3,947)‐8.13%‐71.90%‐127.74%‐129.22%‐129.12%‐100.06%‐100.19%‐104.77%‐102.82%‐88.07%3552005416,4952,763708,352(705,589)‐169.41%‐152.58%‐107.29%‐141.57%‐142.52%‐142.44%‐119.26%‐119.33%‐121.52%‐117.28%355200694,689‐291,242(291,242)‐307.58%‐195.00%‐178.80%‐122.56%‐153.22%‐154.06%‐153.99%‐130.41%‐130.46%‐131.87%3552007261,7471,6411,446,549(1,444,907)‐552.02%‐487.09%‐315.91%‐297.72%‐197.31%‐218.00%‐218.54%‐218.45%‐189.71%‐189.70%3552008310,87623,5611,316,268(1,292,708)‐415.83%‐478.08%‐453.89%‐344.57%‐330.15%‐234.75%‐249.99%‐250.38%‐250.29%‐222.07%3552009554,65417,3991,639,950(1,622,551)‐292.53%‐336.82%‐386.79%‐380.65%‐326.95%‐317.78%‐248.27%‐259.52%‐259.80%‐259.73%35520101,189,1529,9134,552,142(4,542,228)‐381.97%‐353.52%‐362.95%‐384.32%‐381.30%‐350.09%‐344.32%‐292.95%‐299.24%‐299.39%35520111,139,61146,4037,851,658(7,805,254)‐684.91%‐530.22%‐484.50%‐477.81%‐483.43%‐478.74%‐446.27%‐440.97%‐388.03%‐390.70%35520121,370,07640,5134,164,490(4,123,978)‐301.00%‐475.33%‐445.31%‐425.39%‐424.74%‐431.64%‐429.26%‐408.98%‐405.37%‐368.38%Appendix E-2Page 5 of 29Transactional2- yr3- yr4- yr5- yr6- yr7- yr8- yr9- yr 10- yrTransaction HistoryRemovalNetNet Net Net Net Net Net Net Net Net NetAcctYearRetirements SalvageCostSalvageSalv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. %Southwestern Public Service Company - TexasRetirement and Salvage Analysis3561968232,619133,61731,144102,47344.05%3561969110,26648,1546,62941,52537.66% 42.00%3561970129,48442,92514,38528,54022.04% 29.22% 36.53%356197176,53243,28214,41128,87137.72% 27.87% 31.28% 36.69%356197285,46735,7158,10227,61332.31% 34.87% 29.17% 31.50% 36.10%356197338,55017,0277,6989,32924.20% 29.79% 32.82% 28.59% 30.86% 35.42%356197426,9219,0165,2253,79114.08% 20.04% 26.99% 30.60% 27.49% 29.89% 34.60%3561975152,62987,48125,04062,44140.91% 36.89% 34.65% 33.99% 34.74% 31.51% 32.61% 35.73%356197698,4243,9602,0791,8811.91% 25.62% 24.50% 24.47% 26.13% 27.99% 26.72% 28.40% 32.23%356197791,07786,96129,25957,70263.36% 31.44% 35.67% 34.09% 33.16% 33.01% 33.64% 31.49% 32.33% 34.95%356197855,43920,5847,56913,01523.48% 48.27% 29.64% 33.97% 32.71% 32.00% 32.05% 32.74% 30.90% 31.77%356197962,73155,51017,01338,49761.37% 43.59% 52.19% 36.11% 37.70% 36.40% 35.50% 35.05% 35.35% 33.24%3561980115,20341,04612,08928,95725.14% 37.91% 34.48% 42.59% 33.12% 35.19% 34.24% 33.64% 33.48% 33.89%3561981254,446164,73855,676109,06242.86% 37.34% 40.82% 38.85% 42.71% 36.78% 37.54% 36.80% 36.26% 35.92%356198253,13417,4626,37211,09020.87% 39.06% 35.27% 38.64% 37.09% 40.87% 35.62% 36.54% 35.87% 35.40%3561983278,432158,131156,4601,6710.60% 3.85% 20.79% 21.50% 24.78%24.69% 28.56% 25.96% 27.92% 27.61%356198457,102178,339206,053(27,714)‐48.53%‐7.76%‐3.85% 14.63% 16.23% 19.68%19.92% 24.01% 21.97% 24.34%356198599,11856,52066,046(9,526)‐9.61%‐23.84%‐8.18%‐5.02% 11.40% 13.24% 16.52% 16.92% 20.88% 19.28%3561986166,651129,995139,705(9,710)‐5.83%‐7.24%‐14.54%‐7.53%‐5.22% 8.24% 10.14%13.10% 13.60% 17.27%35619877,456‐1,826(1,826)‐24.49%‐6.63%‐7.71%‐14.77%‐7.74%‐5.44% 7.97% 9.89% 12.84% 13.35%356198835,27715,81921,645(5,826)‐16.52%‐17.91%‐8.29%‐8.72%‐14.93%‐8.22%‐6.00% 7.06% 9.02% 11.92%35619891,276,523479,266294,601184,66514.47% 13.63% 13.42% 11.26% 9.95% 7.92% 6.86% 7.24% 11.30% 11.98%3561990182,779223,68491,490132,19472.32% 21.71% 20.81% 20.59% 17.95% 16.40% 14.37% 12.55% 12.75% 15.93%356199158,17213,30396,122(82,819)‐142.37% 20.49% 15.42% 14.70% 14.51%12.55% 11.34% 9.53% 8.38% 8.68%3561992116,18017,78460,389(42,605)‐36.67%‐71.94% 1.90% 11.72% 11.12% 10.96% 9.44% 8.47% 6.84% 6.08%3561993133,61014,46862,296(47,828)‐35.80%‐36.20%‐56.26%‐8.37% 8.13% 7.64% 7.51% 6.39% 5.62% 4.17%356199440,3656,96524,528(17,563)‐43.51%‐37.59%‐37.22%‐54.78%‐11.04% 6.97% 6.52% 6.40% 5.39% 4.69%3561995228,42685,403215,750(130,347)‐57.06%‐55.03%‐48.64%‐45.96%‐55.68%‐24.88%‐0.21%‐0.49%‐0.58%‐0.96%3561996107,18531,806155,228(123,422)‐115.15%‐75.61%‐72.17%‐62.63%‐57.81%‐65.00%‐36.04%‐5.96%‐6.13%‐6.19%356199750,0122,49129,959(27,467)‐54.92%‐95.99%‐72.93%‐70.14%‐61.94%‐57.60%‐64.32%‐37.07%‐7.08%‐7.23%356199820,801‐‐‐0.00%‐38.79%‐84.77%‐69.20%‐66.88%‐59.72%‐55.88%‐62.54%‐36.25%‐7.01%356199951,014‐‐‐0.00% 0.00%‐22.55%‐65.89%‐61.48%‐60.02%‐54.90%‐52.06%‐58.58%‐34.38%35620004,808‐‐‐0.00% 0.00% 0.00%‐21.69%‐64.53%‐60.84%‐59.45%‐54.48%‐51.73%‐58.24%356200111,295‐‐‐0.00% 0.00% 0.00% 0.00%‐19.91%‐61.56%‐59.39%‐58.14%‐53.53%‐50.97%3562002935,765185,103642,281(457,178)‐48.86%‐48.27%‐48.03%‐45.59%‐44.66%‐45.14%‐51.49%‐52.40%‐52.15%‐50.77%35620031,382,634330,971571,644(240,673)‐17.41%‐30.10%‐29.95%‐29.89%‐29.25%‐29.00%‐29.53%‐33.11%‐35.07%‐35.19%3562004162,255‐‐‐0.00%‐15.58%‐28.13%‐28.00%‐27.95%‐27.39%‐27.17%‐27.70%‐31.14%‐33.14%35620051,754,1978,53437,905(29,370)‐1.67%‐1.53%‐8.19%‐17.17%‐17.13%‐17.11%‐16.90%‐16.82%‐17.26%‐19.60%356200697,983305,2536,368298,885305.04% 14.55% 13.38% 0.85%‐9.89%‐9.86%‐9.85%‐9.74%‐9.69%‐10.20%356200794,315‐307,590(307,590)‐326.13%‐4.53%‐1.96%‐1.81%‐7.98%‐16.62%‐16.58%‐16.56%‐16.37%‐16.30%3562008150,26140,919272,386(231,467)‐154.04%‐220.40%‐70.11%‐12.86%‐11.93%‐14.01%‐21.13%‐21.08%‐21.06%‐20.83%3562009546,4353,220296,531(293,311)‐53.68%‐75.32%‐105.23%‐60.01%‐21.29%‐20.06%‐19.19%‐24.60%‐24.55%‐24.53%3562010824,29436,174259,987(223,813)‐27.15%‐37.73%‐49.22%‐65.39%‐44.20%‐22.69%‐21.67%‐20.50%‐24.96%‐24.91%35620111,633,243194,4651,124,400(929,935)‐56.94%‐46.95%‐48.17%‐53.22%‐61.14%‐50.42%‐33.65%‐32.62%‐29.45%‐31.85%3562012560,65228,813826,707(797,894)‐142.32%‐78.76%‐64.66%‐62.98%‐66.66%‐73.09%‐63.60%‐44.41%‐43.18%‐38.23%Appendix E-2Page 6 of 29Transactional2- yr3- yr4- yr5- yr6- yr7- yr8- yr9- yr 10- yrTransaction HistoryRemovalNetNet Net Net Net Net Net Net Net Net NetAcctYearRetirements SalvageCostSalvageSalv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. %Southwestern Public Service Company - TexasRetirement and Salvage Analysis3571985‐‐‐‐NA3571986‐‐‐‐NANA3571987‐‐‐‐NANANA3571988‐‐‐‐NANANANA3571989‐‐‐‐NANANANANA3571990‐‐‐‐NANANANANANA3571991‐‐‐‐NANANANANANANA3571992‐‐‐‐NANANANANANANANA3571993‐‐‐‐NANANANANANANANANA3571994‐‐‐‐NANANANANANANANANANA3571995‐‐‐‐NANANANANANANANANANA3571996‐‐‐‐NANANANANANANANANANA3571997‐‐‐‐NANANANANANANANANANA3571998‐‐‐‐NANANANANANANANANANA3571999‐‐‐‐NANANANANANANANANANA3572000‐‐‐‐NANANANANANANANANANA3572001‐‐‐‐NANANANANANANANANANA3572002‐‐‐‐NANANANANANANANANANA3572003‐‐‐‐NANANANANANANANANANA3572004‐‐‐‐NANANANANANANANANANA3572005‐‐‐‐NANANANANANANANANANA3571998‐‐‐‐NANANANANANANANANANA3571999‐‐‐‐NANANANANANANANANANA3572000‐‐‐‐NANANANANANANANANANA3572001‐‐‐‐NANANANANANANANANANA3572002‐‐‐‐NANANANANANANANANANA3572003‐‐‐‐NANANANANANANANANANA3572004‐‐‐‐NANANANANANANANANANA3572005‐‐‐‐NANANANANANANANANANA3572006‐‐‐‐NANANANANANANANANANA3572007‐‐‐‐NANANANANANANANANANA3572008‐‐‐‐NANANANANANANANANANA3572009‐‐‐‐NANANANANANANANANANA3572010‐‐‐‐NANANANANANANANANANA3572011‐‐‐‐NANANANANANANANANANA35720128‐582(582)‐7534.97%‐7534.97%‐7534.97%‐7534.97%‐7534.97%‐7534.97%‐7534.97%‐7534.97%‐7534.97%‐7534.97%Appendix E-2Page 7 of 29Transactional2- yr3- yr4- yr5- yr6- yr7- yr8- yr9- yr 10- yrTransaction HistoryRemovalNetNet Net Net Net Net Net Net Net Net NetAcctYearRetirements SalvageCostSalvageSalv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. %Southwestern Public Service Company - TexasRetirement and Salvage Analysis3581985‐‐‐‐NA3581986‐‐‐‐NANA3581987‐‐‐‐NANANA3581988‐‐‐‐NANANANA3581989‐‐‐‐NANANANANA3581990‐‐‐‐NANANANANANA3581991‐‐‐‐NANANANANANANA3581992‐‐‐‐NANANANANANANANA3581993‐‐‐‐NANANANANANANANANA3581994‐‐‐‐NANANANANANANANANANA3581995‐‐‐‐NANANANANANANANANANA3581996‐‐‐‐NANANANANANANANANANA3581997‐‐‐‐NANANANANANANANANANA3581998‐‐‐‐NANANANANANANANANANA3581999‐‐‐‐NANANANANANANANANANA3582000‐‐‐‐NANANANANANANANANANA3582001‐‐‐‐NANANANANANANANANANA3582002‐‐‐‐NANANANANANANANANANA3582003‐‐‐‐NANANANANANANANANANA3582004‐‐‐‐NANANANANANANANANANA3582005‐‐‐‐NANANANANANANANANANA3582006‐‐‐‐NANANANANANANANANANA3582007‐‐‐‐NANANANANANANANANANA3582008‐‐‐‐NANANANANANANANANANA3582009‐‐‐‐NANANANANANANANANANA3582010‐‐‐‐NANANANANANANANANANA35820114‐‐‐0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%358201211,475‐2,840(2,840)‐24.75%‐24.74%‐24.74%‐24.74%‐24.74%‐24.74%‐24.74%‐24.74%‐24.74%‐24.74%3601995‐‐‐0 NA NA3601996‐‐‐0 NA NA NA3601997‐‐‐0 NA NA NA NA3601998‐‐‐0 NA NA NA NA NA3601999‐‐‐0 NA NA NA NA NA NA3602000‐‐‐0 NA NA NA NA NA NA NA3602001‐‐‐0 NA NA NA NA NA NA NA NA3602002‐‐‐0 NA NA NA NA NA NA NA NA NA3602003‐‐‐0 NA NA NA NA NA NA NA NA NA NA3602004‐‐‐0 NA NA NA NA NA NA NA NA NA NA3602005‐‐‐0 NA NA NA NA NA NA NA NA NA NA3602006‐‐‐0 NA NA NA NA NA NA NA NA NA NA3602007‐‐‐0 NA NA NA NA NA NA NA NA NA NA3602008‐‐‐0 NA NA NA NA NA NA NA NA NA NA3602009‐‐‐0 NA NA NA NA NA NA NA NA NA NA3602010‐‐‐0 NA NA NA NA NA NA NA NA NA NA3602011‐‐‐0 NA NA NA NA NA NA NA NA NA NA3602012‐‐‐0 NA NA NA NA NA NA NA NA NA NAAppendix E-2Page 8 of 29Transactional2- yr3- yr4- yr5- yr6- yr7- yr8- yr9- yr 10- yrTransaction HistoryRemovalNetNet Net Net Net Net Net Net Net Net NetAcctYearRetirements SalvageCostSalvageSalv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. %Southwestern Public Service Company - TexasRetirement and Salvage Analysis361197741923510513031.03%3611978‐‐‐‐NA 31.03%3611979‐‐‐‐NANA 31.03%3611980‐‐‐‐NANANA 31.03%3611981‐‐‐‐NANANANA 31.03%3611982‐‐‐‐NANANANANA 31.03%3611983‐‐‐‐NANANANANANA 31.03%3611984‐‐‐‐NANANANANANANA 31.03%3611985‐‐‐‐NANANANANANANANA 31.03%3611986‐‐‐‐NANANANANANANANANA 31.03%3611987‐‐‐‐NANANANANANANANANANA3611988‐‐‐‐NANANANANANANANANANA3611989‐‐‐‐NANANANANANANANANANA3611990‐‐‐‐NANANANANANANANANANA3611991600‐88(88)‐14.67%‐14.67%‐14.67%‐14.67%‐14.67%‐14.67%‐14.67%‐14.67%‐14.67%‐14.67%3611992‐‐‐‐NA‐14.67%‐14.67%‐14.67%‐14.67%‐14.67%‐14.67%‐14.67%‐14.67%‐14.67%3611993‐‐‐‐NANA‐14.67%‐14.67%‐14.67%‐14.67%‐14.67%‐14.67%‐14.67%‐14.67%3611994‐‐‐‐NANANA‐14.67%‐14.67%‐14.67%‐14.67%‐14.67%‐14.67%‐14.67%3611995‐‐‐‐NANANANA‐14.67%‐14.67%‐14.67%‐14.67%‐14.67%‐14.67%3611996‐‐‐‐NANANANANA‐14.67%‐14.67%‐14.67%‐14.67%‐14.67%3611997‐‐‐‐NANANANANANA‐14.67%‐14.67%‐14.67%‐14.67%3611998‐‐‐‐NANANANANANANA‐14.67%‐14.67%‐14.67%3611999‐‐‐‐NANANANANANANANA‐14.67%‐14.67%3612000‐‐‐‐NANANANANANANANANA‐14.67%3612001‐‐‐‐NANANANANANANANANANA361200219,57415,64535,136(19,490)‐99.57%‐99.57%‐99.57%‐99.57%‐99.57%‐99.57%‐99.57%‐99.57%‐99.57%‐99.57%361200318,938‐3,675(3,675)‐19.41%‐60.15%‐60.15%‐60.15%‐60.15%‐60.15%‐60.15%‐60.15%‐60.15%‐60.15%36120042,084‐‐‐0.00%‐17.48%‐57.06%‐57.06%‐57.06%‐57.06%‐57.06%‐57.06%‐57.06%‐57.06%3612005229,476‐6,041(6,041)‐2.63%‐2.61%‐3.88%‐10.81%‐10.81%‐10.81%‐10.81%‐10.81%‐10.81%‐10.81%3612006‐‐143(143)NA‐2.69%‐2.67%‐3.94%‐10.87%‐10.87%‐10.87%‐10.87%‐10.87%‐10.87%361200752,82015021,787(21,637)‐40.96%‐41.23%‐9.86%‐9.78%‐10.38%‐15.79%‐15.79%‐15.79%‐15.79%‐15.79%36120086,000‐1,030(1,030)‐17.17%‐38.54%‐38.78%‐10.01%‐9.94%‐10.52%‐15.82%‐15.82%‐15.82%‐15.82%36120097,65670284(214)‐2.80%‐9.11%‐34.42%‐34.63%‐9.82%‐9.75%‐10.33%‐15.52%‐15.52%‐15.52%361201016,8951161,767(1,651)‐9.77%‐7.60%‐9.48%‐29.42%‐29.60%‐9.82%‐9.75%‐10.30%‐15.24%‐15.24%361201137,53824(2,977)3,0007.99% 2.48% 1.83% 0.15%‐17.81%‐17.93%‐7.91%‐7.86%‐8.45%‐13.01%361201238,708353,938(3,904)‐10.08%‐1.18%‐2.74%‐2.75%‐3.56%‐15.93%‐16.02%‐8.13%‐8.08%‐8.61%Appendix E-2Page 9 of 29Transactional2- yr3- yr4- yr5- yr6- yr7- yr8- yr9- yr 10- yrTransaction HistoryRemovalNetNet Net Net Net Net Net Net Net Net NetAcctYearRetirements SalvageCostSalvageSalv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. %Southwestern Public Service Company - TexasRetirement and Salvage Analysis362197279,9983,2093,964(755)‐0.94%362197375,2565,9333,8722,0612.74% 0.84%3621974113,7236,9204,1202,8002.46% 2.57% 1.53%3621975214,51013,4748,9354,5392.12% 2.24% 2.33% 1.79%362197689,48919,14217,9111,2311.38% 1.90% 2.05% 2.16% 1.72%3621977248,49122,84916,4846,3652.56% 2.25% 2.20% 2.24% 2.29% 1.98%3621978204,65724,07618,5755,5012.69% 2.62% 2.41% 2.33% 2.35% 2.38% 2.12%3621979214,97127,28317,20510,0784.69% 3.71% 3.28% 3.06% 2.85% 2.81% 2.81% 2.56%3621980116,77160,24121,29138,95033.36% 14.78% 10.17% 7.76% 7.11% 6.12% 5.78% 5.60% 5.21%3621981227,11736,70917,62319,0868.40% 16.88% 12.19% 9.64% 7.90% 7.37% 6.52% 6.19% 6.02% 5.67%3621982302,24724,78730,319(5,532)‐1.83% 2.56% 8.13% 7.27% 6.39% 5.66% 5.39% 4.96% 4.79% 4.71%3621983333,30877,82335,87741,94612.58% 5.73% 6.43% 9.64% 8.75% 7.86% 7.06% 6.77% 6.26% 6.05%3621984187,08471,29631,55639,74021.24% 15.70% 9.26% 9.07% 11.50% 10.44% 9.44% 8.51% 8.18% 7.57%362198570,88221,69238,128(16,436)‐23.19% 9.03% 11.04% 6.68% 7.03% 9.52% 8.80% 8.05% 7.33% 7.06%3621986369,0695,36916,052(10,683)‐2.89%‐6.16% 2.01% 5.68% 3.88% 4.57% 6.66% 6.43% 6.05% 5.67%3621987547,820470,87668,536402,34073.44% 42.72% 37.99% 35.32% 30.30% 24.93% 23.09% 23.65% 21.93% 20.40%36219881,092,24125,81273,865(48,053)‐4.40% 21.60% 17.10% 15.73% 16.18%15.72% 13.89% 13.50% 14.21% 13.62%3621989567,817120,516163,899(43,383)‐7.64%‐5.51% 14.08% 11.65% 10.72% 11.41% 11.54% 10.37% 10.25% 10.96%3621990571,86118,205116,955(98,750)‐17.27%‐12.47%‐8.52% 7.63% 6.40% 5.75% 6.60% 7.13% 6.46% 6.56%3621991328,19512,17491,148(78,974)‐24.06%‐19.75%‐15.06%‐10.51% 4.29% 3.52% 2.99% 3.90% 4.61% 4.17%3621992603,3312,59453,702(51,108)‐8.47%‐13.96%‐15.22%‐13.14%‐10.12% 2.21% 1.75% 1.32% 2.18% 2.92%3621993361,48150,25883,491(33,233)‐9.19%‐8.74%‐12.63%‐14.05%‐12.56%‐10.03% 1.20% 0.86% 0.48% 1.31%3621994466,92643173,486(73,055)‐15.65%‐12.83%‐10.99%‐13.43%‐14.37%‐13.05%‐10.69%‐0.53%‐0.71%‐1.03%3621995966,7824,73795,654(90,917)‐9.40%‐11.44%‐10.99%‐10.35%‐12.00%‐12.92%‐12.14%‐10.44%‐2.09%‐2.14%3621996527,778185,317140,02045,2968.58%‐3.05%‐6.05%‐6.54%‐6.94%‐8.66%‐9.95%‐9.65%‐8.61%‐1.16%362199764,126110,71981,38629,33345.74% 12.61%‐1.04%‐4.41%‐5.13%‐5.81%‐7.61%‐9.03%‐8.86%‐7.98%3621998629,4447,00329,265(22,262)‐3.54% 1.02% 4.29%‐1.76%‐4.20%‐4.80%‐5.41%‐6.96%‐8.27%‐8.20%36219991,198,832‐‐‐0.00%‐1.22% 0.37% 2.16%‐1.14%‐2.90%‐3.44%‐4.07%‐5.34%‐6.53%3622000376,750‐‐‐0.00% 0.00%‐1.01% 0.31% 1.87%‐1.02%‐2.64%‐3.15%‐3.77%‐4.98%3622001701,536‐6,799(6,799)‐0.97%‐0.63%‐0.30%‐1.00% 0.01% 1.30%‐1.02%‐2.40%‐2.86%‐3.44%36220021,205,980848,5811,126,729(278,148)‐23.06%‐14.94%‐12.47%‐8.18%‐7.47%‐6.65%‐4.94%‐5.70%‐6.46%‐6.61%3622003927,96561,47078,654(17,184)‐1.85%‐13.84%‐10.66%‐9.41%‐6.85%‐6.44%‐5.78%‐4.43%‐5.16%‐5.86%3622004‐‐‐‐NA‐1.85%‐13.84%‐10.66%‐9.41%‐6.85%‐6.44%‐5.78%‐4.43%‐5.16%3622005701,53632,00071,693(39,693)‐5.66%‐5.66%‐3.49%‐11.82%‐9.66%‐8.73%‐6.69%‐6.34%‐5.77%‐4.57%362200634,831‐70,687(70,687)‐202.94%‐14.99%‐14.99%‐7.66%‐14.13%‐11.55%‐10.45%‐8.01%‐7.53%‐6.94%3622007130,31533,644197,097(163,453)‐125.43%‐141.78%‐31.60%‐31.60%‐16.22%‐18.97%‐15.56%‐14.12%‐10.91%‐10.13%3622008853,19040,07589,580(49,505)‐5.80%‐21.65%‐27.85%‐18.80%‐18.80%‐12.86%‐16.05%‐13.73%‐12.68%‐10.20%3622009350,09926,025168,182(142,157)‐40.60%‐15.93%‐26.63%‐31.12%‐22.49%‐22.49%‐16.10%‐18.10%‐15.65%‐14.53%3622010493,07432,164237,979(205,815)‐41.74%‐41.27%‐23.43%‐30.71%‐33.93%‐26.19%‐26.19%‐19.72%‐20.58%‐18.03%36220112,336,57345,413278,905(233,492)‐9.99%‐15.53%‐18.29%‐15.65%‐19.08%‐20.61%‐18.47%‐18.47%‐15.82%‐17.06%36220121,925,94666,250340,343(274,093)‐14.23%‐11.91%‐15.00%‐16.76%‐15.19%‐17.55%‐18.60%‐17.27%‐17.27%‐15.43%Appendix E-2Page 10 of 29Transactional2- yr3- yr4- yr5- yr6- yr7- yr8- yr9- yr 10- yrTransaction HistoryRemovalNetNet Net Net Net Net Net Net Net Net NetAcctYearRetirements SalvageCostSalvageSalv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. %Southwestern Public Service Company - TexasRetirement and Salvage Analysis3641963401,23736,71319,35217,3614.33%3641964490,50238,24125,16213,0792.67% 3.41%3641965537,35162,17434,69927,4755.11% 3.95% 4.05%3641966647,85651,54628,77022,7763.52% 4.24% 3.78% 3.89%3641967681,47258,21731,87326,3443.87% 3.70% 4.10% 3.80% 3.88%3641968502,67935,81344,742(8,929)‐1.78% 1.47% 2.19% 2.86% 2.82% 3.01%3641969400,47849,36522,52426,8416.70% 1.98% 2.79% 3.00% 3.41% 3.30% 3.41%3641970494,94862,52341,80720,7164.19% 5.31% 2.76% 3.12% 3.22% 3.53% 3.42% 3.50%3641971330,68232,57719,82212,7553.86% 4.05% 4.92% 2.97% 3.22% 3.29% 3.56% 3.45% 3.53%3641972424,36669,30136,84532,4567.65% 5.99% 5.27% 5.62% 3.89% 3.89% 3.82% 3.99% 3.85% 3.89%3641973559,641116,841124,828(7,987)‐1.43% 2.49% 2.83% 3.20% 3.84% 2.80% 3.01% 3.09% 3.33% 3.26%3641974411,264188,315123,69764,61815.71% 5.83% 6.38% 5.90% 5.52% 5.70% 4.50% 4.38% 4.26% 4.35%3641975387,153171,996136,66335,3339.13% 12.52% 6.77% 6.98% 6.49% 6.05% 6.14% 5.01% 4.82% 4.65%3641976432,135132,495106,93525,5605.91% 7.43% 10.20% 6.56% 6.77% 6.39% 6.03% 6.11% 5.11% 4.92%3641977513,655357,319172,740184,57935.93% 22.22% 18.42% 17.78% 13.11%12.26% 11.35% 10.36% 9.99% 8.66%3641978447,056240,689149,08191,60820.49% 28.75% 21.66% 18.94% 18.33% 14.31% 13.42% 12.52% 11.49% 11.05%3641979392,136266,435188,74677,68919.81% 20.17% 26.16% 21.26% 19.09% 18.56% 15.00% 14.12% 13.25% 12.23%3641980535,575257,510219,96337,5477.01% 12.42% 15.05% 20.73% 17.97%16.70% 16.57% 13.84% 13.20% 12.50%3641981467,929218,306199,12619,1804.10% 5.65% 9.63% 12.27% 17.43%15.64% 14.85% 14.95% 12.74% 12.26%3641982310,340164,516194,917(30,401)‐9.80%‐1.44% 2.00% 6.10% 9.09% 14.26% 13.09% 12.65% 12.98% 11.17%3641983429,981290,796266,80323,9935.58%‐0.87% 1.06% 2.89% 5.99% 8.50% 13.05% 12.18% 11.88% 12.24%3641984545,822297,436346,794(49,358)‐9.04%‐2.60%‐4.34%‐2.09% 0.04% 2.93% 5.44% 9.74% 9.34% 9.32%3641985878,757377,601414,226(36,625)‐4.17%‐6.04%‐3.34%‐4.27%‐2.78%‐1.13% 1.18% 3.33% 7.04% 6.94%3641986583,454336,840425,597(88,757)‐15.21%‐8.57%‐8.70%‐6.18%‐6.59%‐5.04%‐3.32%‐1.13% 0.98% 4.49%3641987758,672316,974546,450(229,476)‐30.25%‐23.71%‐15.98%‐14.61%‐11.89%‐11.71%‐9.85%‐7.85%‐5.63%‐3.45%3641988692,349350,803611,741(260,938)‐37.69%‐33.80%‐28.47%‐21.14%‐19.23%‐16.49%‐15.99%‐13.98%‐11.82%‐9.60%3641989850,756398,637908,685(510,048)‐59.95%‐49.96%‐43.46%‐37.75%‐29.91%‐27.27%‐24.29%‐23.40%‐21.07%‐18.58%3641990763,636378,220809,202(430,982)‐56.44%‐58.29%‐52.11%‐46.70%‐41.66%‐34.39%‐31.66%‐28.75%‐27.74%‐25.37%3641991753,212416,567752,983(336,416)‐44.66%‐50.59%‐53.96%‐50.27%‐46.30%‐42.18%‐35.85%‐33.34%‐30.67%‐29.68%3641992534,767306,690636,824(330,134)‐61.73%‐51.75%‐53.50%‐55.39%‐51.98%‐48.19%‐44.29%‐38.23%‐35.73%‐33.11%3641993578,703360,584696,382(335,798)‐58.03%‐59.81%‐53.70%‐54.49%‐55.83%‐52.82%‐49.35%‐45.74%‐40.02%‐37.59%3641994600,154304,882556,415(251,533)‐41.91%‐49.82%‐53.54%‐50.83%‐52.16%‐53.78%‐51.45%‐48.54%‐45.36%‐40.18%3641995444,793249,288344,000(94,713)‐21.29%‐33.14%‐42.01%‐46.89%‐46.32%‐48.42%‐50.59%‐48.88%‐46.51%‐43.73%3641996626,066350,884484,196(133,312)‐21.29%‐21.29%‐28.70%‐36.24%‐41.14%‐41.89%‐44.47%‐47.03%‐45.92%‐44.12%3641997823,963461,797637,248(175,452)‐21.29%‐21.29%‐21.29%‐26.25%‐32.24%‐36.61%‐38.00%‐40.75%‐43.48%‐42.88%3641998659,184369,445509,809(140,364)‐21.29%‐21.29%‐21.29%‐21.29%‐25.22%‐30.30%‐34.24%‐35.81%‐38.53%‐41.28%36419991,942,608‐‐‐0.00%‐5.39%‐9.22%‐11.08%‐12.09%‐15.61%‐19.93%‐23.53%‐25.82%‐28.84%364200015,775‐‐‐0.00% 0.00%‐5.36%‐9.18%‐11.04%‐12.05%‐15.56%‐19.88%‐23.47%‐25.76%3642001542,22485,539573,862(488,324)‐90.06%‐87.51%‐19.53%‐19.90%‐20.19%‐20.34%‐20.42%‐22.70%‐25.98%‐28.81%36420021,128,528238,332374,839(136,507)‐12.10%‐37.40%‐37.05%‐17.22%‐17.84%‐18.40%‐18.72%‐18.90%‐20.94%‐23.85%3642003379,6769,854194,443(184,589)‐48.62%‐21.29%‐39.48%‐39.17%‐20.19%‐20.35%‐20.49%‐20.57%‐20.62%‐22.40%3642004519,7898,086442,577(434,491)‐83.59%‐68.83%‐37.26%‐48.40%‐48.10%‐27.47%‐26.68%‐25.94%‐25.51%‐25.24%36420051,104,4534,3691,045,711(1,041,342)‐94.29%‐90.86%‐82.86%‐57.37%‐62.19%‐61.92%‐40.57%‐38.55%‐36.55%‐35.32%3642006117,34059,542576,470(516,928)‐440.54%‐127.54%‐114.42%‐102.64%‐71.20%‐73.90%‐73.59%‐48.73%‐45.91%‐43.10%3642007482,983341,150947,594(606,444)‐125.56%‐187.13%‐126.98%‐116.84%‐106.89%‐78.23%‐79.73%‐79.44%‐54.68%‐51.49%3642008926,301‐1,074,160(1,074,160)‐115.96%‐119.25%‐143.95%‐123.10%‐116.58%‐109.27%‐85.74%‐86.19%‐85.93%‐62.61%36420091,162,960‐1,067,194(1,067,194)‐91.77%‐102.49%‐106.82%‐121.38%‐113.50%‐109.89%‐104.94%‐86.94%‐87.21%‐86.99%36420101,194,6878041,533,157(1,532,354)‐128.26%‐110.26%‐111.87%‐113.62%‐123.50%‐117.03%‐113.88%‐109.67%‐93.98%‐93.69%36420111,607,0572561,853,673(1,853,417)‐115.33%‐120.85%‐112.32%‐113.01%‐114.13%‐121.11%‐116.62%‐114.20%‐110.88%‐97.96%36420121,733,849‐1,647,053(1,647,053)‐94.99%‐104.78%‐110.96%‐107.05%‐108.29%‐109.47%‐114.84%‐112.12%‐110.44%‐107.90%Appendix E-2Page 11 of 29Transactional2- yr3- yr4- yr5- yr6- yr7- yr8- yr9- yr 10- yrTransaction HistoryRemovalNetNet Net Net Net Net Net Net Net Net NetAcctYearRetirements SalvageCostSalvageSalv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. %Southwestern Public Service Company - TexasRetirement and Salvage Analysis3651963361,11368,27821,35846,92012.99%3651964431,01170,36226,12844,23410.26% 11.51%3651965531,64897,70640,35457,35210.79% 10.55% 11.22%3651966688,65084,62632,64751,9797.55% 8.96% 9.30% 9.96%3651967654,12590,45432,20458,2508.91% 8.21% 8.94% 9.19% 9.70%3651968490,12584,66440,24944,4159.06% 8.97% 8.44% 8.97% 9.17% 9.60%3651969382,97471,57424,90646,66812.19% 10.43% 9.78% 9.08% 9.41% 9.53% 9.88%3651970534,31761,96146,48615,4752.90% 6.77% 7.57% 7.99% 7.88% 8.35% 8.57% 8.97%3651971383,41462,25828,38233,8768.84% 5.38% 7.38% 7.84% 8.13% 8.00% 8.40% 8.60% 8.96%3651972427,48671,65637,08634,5708.09% 8.44% 6.24% 7.56% 7.89% 8.12% 8.01% 8.37% 8.55% 8.88%3651973684,294140,443133,9636,4800.95% 3.69% 5.01% 4.45% 5.68% 6.25% 6.74% 6.87% 7.31% 7.55%3651974440,078195,353136,91358,44013.28% 5.77% 6.41% 6.89% 6.03% 6.85% 7.18% 7.46% 7.47% 7.81%3651975384,410201,043145,03056,01314.57% 13.88% 8.02% 8.03% 8.16% 7.18% 7.77% 7.94% 8.08% 8.01%3651976452,090130,180108,18821,9924.86% 9.33% 10.69% 7.29% 7.43% 7.63% 6.86% 7.41% 7.61% 7.78%3651977605,553381,854196,498185,35630.61% 19.60% 18.26% 17.10% 12.79% 12.12% 11.75% 10.54% 10.68% 10.52%3651978420,047233,391151,62481,76719.47% 26.05% 19.57% 18.53% 17.53% 13.73% 13.02% 12.60% 11.40% 11.47%3651979483,298349,162212,692136,47028.24% 24.16% 26.75% 21.70% 20.53% 19.39% 15.75% 14.91% 14.37% 13.09%3651980506,013270,303233,31636,9877.31% 17.53% 18.11% 21.87% 18.75%18.19% 17.53% 14.68% 14.04% 13.62%3651981530,589224,312219,3654,9470.93% 4.05% 11.74% 13.41% 17.50%15.60% 15.48% 15.23% 13.06% 12.63%3651982291,819160,433186,604(26,171)‐8.97%‐2.58% 1.19% 8.40% 10.48% 14.78% 13.42% 13.54% 13.51% 11.72%3651983554,301270,132313,647(43,515)‐7.85%‐8.24%‐4.70%‐1.47% 4.59% 6.84% 11.08% 10.35% 10.73% 10.97%3651984517,494216,916322,681(105,765)‐20.44%‐13.93%‐12.87%‐9.00%‐5.56% 0.10% 2.56% 6.91% 6.70% 7.33%3651985777,972308,952399,847(90,895)‐11.68%‐15.18%‐12.98%‐12.44%‐9.78%‐7.06%‐2.40%‐0.15% 3.82% 3.91%3651986501,364239,297361,023(121,726)‐24.28%‐16.62%‐17.72%‐15.39%‐14.68%‐12.07%‐9.41%‐5.04%‐2.79% 1.11%3651987786,423280,356515,129(234,773)‐29.85%‐27.68%‐21.66%‐21.41%‐19.02%‐18.16%‐15.60%‐13.01%‐8.98%‐6.75%3651988701,100215,972554,590(338,618)‐48.30%‐38.55%‐34.95%‐28.41%‐27.15%‐24.37%‐23.28%‐20.52%‐17.80%‐13.86%3651989723,363273,460663,715(390,255)‐53.95%‐51.17%‐43.59%‐40.02%‐33.70%‐31.99%‐29.06%‐27.85%‐25.01%‐22.24%3651990613,039202,818585,625(382,807)‐62.44%‐57.85%‐54.56%‐47.68%‐44.15%‐38.00%‐36.03%‐33.01%‐31.73%‐28.84%3651991637,607267,840592,672(324,832)‐50.95%‐56.58%‐55.62%‐53.70%‐48.28%‐45.24%‐39.74%‐37.84%‐34.98%‐33.74%3651992487,478185,696499,352(313,656)‐64.34%‐56.75%‐58.76%‐57.35%‐55.34%‐50.26%‐47.34%‐42.03%‐40.09%‐37.25%3651993535,714210,068570,998(360,930)‐67.37%‐65.93%‐60.18%‐60.79%‐59.14%‐57.08%‐52.31%‐49.49%‐44.39%‐42.41%3651994579,211193,724512,948(319,224)‐55.11%‐61.00%‐62.02%‐58.87%‐59.64%‐58.49%‐56.82%‐52.63%‐50.07%‐45.37%3651995430,960200,145298,842(98,697)‐22.90%‐41.37%‐50.38%‐53.73%‐53.06%‐54.82%‐54.66%‐53.71%‐50.30%‐48.12%3651996629,381292,294436,433(144,139)‐22.90%‐22.90%‐34.28%‐42.43%‐46.44%‐47.31%‐49.68%‐50.35%‐50.08%‐47.48%3651997875,349406,526606,995(200,469)‐22.90%‐22.90%‐22.90%‐30.32%‐36.83%‐40.62%‐42.20%‐44.79%‐45.99%‐46.25%3651998499,386231,923346,290(114,368)‐22.90%‐22.90%‐22.90%‐22.90%‐29.09%‐34.87%‐38.43%‐40.13%‐42.72%‐44.07%36519991,263,868‐‐‐0.00%‐6.49%‐11.93%‐14.04%‐15.08%‐20.50%‐25.71%‐29.27%‐31.59%‐34.48%36520008,908‐‐‐0.00% 0.00%‐6.45%‐11.89%‐14.01%‐15.04%‐20.45%‐25.67%‐29.22%‐31.55%3652001666,20335,214811,740(776,526)‐116.56%‐115.02%‐40.05%‐36.54%‐32.93%‐31.33%‐30.50%‐33.38%‐36.70%‐38.95%365200220,460315,552487,063(171,511)‐838.29%‐138.06%‐136.30%‐48.38%‐43.21%‐37.88%‐35.50%‐34.26%‐36.69%‐39.67%36520033,791,46510,643201,444(190,801)‐5.03%‐9.50%‐25.43%‐25.38%‐19.80%‐20.05%‐20.40%‐20.60%‐20.72%‐23.00%36520041,208,15359,549370,273(310,725)‐25.72%‐10.03%‐13.41%‐25.49%‐25.45%‐20.83%‐20.97%‐21.17%‐21.29%‐21.37%36520053,066,05966,751735,813(669,062)‐21.82%‐22.92%‐14.51%‐16.60%‐24.21%‐24.18%‐21.13%‐21.22%‐21.35%‐21.43%3652006705,708118,144656,658(538,514)‐76.31%‐32.02%‐30.49%‐19.48%‐21.39%‐28.09%‐28.07%‐24.76%‐24.68%‐24.55%36520071,390,592389,623920,054(530,431)‐38.14%‐50.99%‐33.67%‐32.16%‐22.04%‐23.68%‐29.38%‐29.36%‐26.30%‐26.16%36520082,135,067180,7041,081,479(900,776)‐42.19%‐40.59%‐46.55%‐36.16%‐34.68%‐25.54%‐26.89%‐31.49%‐31.47%‐28.68%36520091,778,272121,6161,071,014(949,397)‐53.39%‐47.28%‐44.88%‐48.57%‐39.54%‐37.91%‐29.06%‐30.23%‐34.13%‐34.11%36520101,569,978121,9251,289,013(1,167,088)‐74.34%‐63.21%‐55.03%‐51.61%‐53.91%‐44.67%‐42.74%‐33.60%‐34.65%‐37.99%36520112,652,459408,6681,461,472(1,052,804)‐39.69%‐52.57%‐52.82%‐50.03%‐48.29%‐50.22%‐43.68%‐42.18%‐34.48%‐35.38%36520123,181,058276,9831,432,984(1,156,001)‐36.34%‐37.86%‐45.60%‐47.11%‐46.18%‐45.30%‐46.93%‐42.26%‐41.13%‐34.76%Appendix E-2Page 12 of 29Transactional2- yr3- yr4- yr5- yr6- yr7- yr8- yr9- yr 10- yrTransaction HistoryRemovalNetNet Net Net Net Net Net Net Net Net NetAcctYearRetirements SalvageCostSalvageSalv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. %Southwestern Public Service Company - TexasRetirement and Salvage Analysis366198534,31624,1304,96119,16955.86%366198631,46715,4589,6235,83518.54% 38.01%366198710,3535,964‐5,96457.61% 28.21% 40.67%366198835,3336,3629,800(3,438)‐9.73% 5.53% 10.84% 24.70%366198961,02048,22314,42133,80255.39% 31.51% 34.04% 30.51% 35.56%366199018,02316,24113,2103,03116.82% 46.60% 29.20% 31.56% 28.93% 33.78%3661991211,657261,62917,254244,375115.46% 107.72% 96.73% 85.20% 84.35% 78.72% 76.77%366199214,8269,8967,5842,31215.59% 108.92% 102.13% 92.80% 82.17% 81.45% 76.27% 74.59%366199318,93512,2158,3833,83220.24% 18.20% 102.08% 96.25% 88.56% 78.91% 78.31% 73.63% 72.23%366199413,7156,98614,603(7,617)‐55.54%‐11.59%‐3.10% 93.74% 88.73% 82.72%73.97% 73.53% 69.37% 68.34%366199524,92922,5785,53717,04168.36% 24.39% 23.02% 21.50% 91.51% 87.05% 81.73% 73.62% 73.22% 69.31%366199618,65716,8984,14412,75468.36% 68.36% 38.70% 34.12% 31.10% 90.08% 85.97% 81.08% 73.39% 73.00%366199774,07367,08816,45350,63568.36% 68.36% 68.36% 55.42% 50.99% 47.81% 85.81% 82.66% 79.01% 72.63%366199820,90318,9324,64314,28968.36% 68.36% 68.36% 68.36% 57.20% 53.11% 50.12% 84.89% 81.94% 78.54%366199921,151‐‐‐0.00% 33.98% 55.91% 57.63% 59.31%50.22% 47.27% 45.00% 80.61% 77.98%3662000‐‐‐‐NA 0.00% 33.98% 55.91% 57.63% 59.31% 50.22% 47.27% 45.00% 80.61%36620012,1546367(361)‐16.75%‐16.75%‐1.55% 31.51% 54.58% 56.46%58.29% 49.40% 46.56% 44.37%366200225,082‐7,725(7,725)‐30.80%‐29.69%‐29.69%‐16.71% 8.95% 39.65% 42.95% 46.34% 39.38% 37.73%36620036,363‐289(289)‐4.55%‐25.49%‐24.93%‐24.93%‐15.30% 7.82% 37.77%41.16% 44.67% 38.03%366200425,417‐10,283(10,283)‐40.46%‐33.27%‐32.18%‐31.62%‐31.62%‐23.27%‐4.32% 26.42% 30.45% 34.77%366200531,988‐29,991(29,991)‐93.76%‐70.16%‐63.61%‐54.35%‐53.46%‐53.46%‐43.38%‐25.82% 7.86% 12.86%366200630,369‐6,266(6,266)‐20.63%‐58.14%‐53.02%‐49.75%‐45.76%‐45.24%‐45.24%‐38.53%‐24.86% 4.21%366200725,49553626,378(25,842)‐101.36%‐57.47%‐70.68%‐63.90%‐60.75%‐55.55%‐54.99%‐54.99%‐48.06%‐35.18%366200819,968‐5,311(5,311)‐26.60%‐68.52%‐49.34%‐62.52%‐58.31%‐55.86%‐52.04%‐51.59%‐51.59%‐45.78%36620097,842‐10,509(10,509)‐134.02%‐56.89%‐78.16%‐57.28%‐67.37%‐62.52%‐60.02%‐55.77%‐55.29%‐55.29%36620101,023‐5,674(5,674)‐554.68%‐182.56%‐74.55%‐87.13%‐63.29%‐71.64%‐66.06%‐63.43%‐58.71%‐58.20%3662011560‐7,414(7,414)‐1324.46%‐826.94%‐250.39%‐98.35%‐99.75%‐71.57%‐77.62%‐71.00%‐68.16%‐62.78%366201211,591‐1,391(1,391)‐12.00%‐72.46%‐109.90%‐118.90%‐73.93%‐84.45%‐64.44%‐71.72%‐66.57%‐64.11%Appendix E-2Page 13 of 29Transactional2- yr3- yr4- yr5- yr6- yr7- yr8- yr9- yr 10- yrTransaction HistoryRemovalNetNet Net Net Net Net Net Net Net Net NetAcctYearRetirements SalvageCostSalvageSalv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. %Southwestern Public Service Company - TexasRetirement and Salvage Analysis367197475,0834,8852,0572,8283.77%367197517,9933,7571,6782,07911.55% 5.27%367197635,2575944721220.35% 4.13% 3.92%367197733,08412,6032,45310,15030.68% 15.03% 14.31% 9.40%367197835,68940,1367,16232,97492.39% 62.70% 41.57% 37.14% 24.43%367197932,24021,7538,56613,18740.90% 67.95% 55.75% 41.41% 37.93% 26.75%367198035,31514,8696,9457,92422.44% 31.25% 52.39% 47.12% 37.51% 35.04% 26.17%367198126,66716,9547,3939,56135.85% 28.21% 32.55% 48.99% 45.28% 37.28% 35.14% 27.06%367198225,1378,7467,3991,3475.36% 21.06% 21.62% 26.83% 41.92% 39.94% 33.69% 32.04% 25.33%367198342,96374,52221,99652,526122.26% 79.11% 66.94% 54.86% 52.08% 59.35% 55.25% 47.98% 45.67% 36.92%367198444,45830,56414,21816,34636.77% 78.78% 62.38% 57.30% 50.25% 48.79% 55.21% 52.26% 46.37% 44.47%367198598,03556,48315,97340,51041.32% 39.90% 58.98% 52.58% 50.70% 47.04% 46.39% 51.21% 49.39% 45.16%367198685,41051,80727,93423,87327.95% 35.10% 35.42% 49.20% 45.47% 44.68% 42.48% 42.35% 46.55% 45.40%367198776,03751,47420,19431,28041.14% 34.16% 36.87% 36.85% 47.43% 44.59% 44.00% 42.25% 42.16% 45.73%367198877,342‐32,301(32,301)‐41.76%‐0.67% 9.57% 18.81% 20.91% 31.17% 29.73% 30.07% 29.54% 30.22%3671989103,46957,80832,22225,58624.73%‐3.71% 9.56% 14.15% 20.20% 21.72% 29.91% 28.79% 29.12% 28.73%367199042,23423,66334,420(10,757)‐25.47% 10.18%‐7.83% 4.62% 9.80% 16.20%17.94% 25.80% 24.94% 25.41%3671991273,642233,62339,208194,41571.05% 58.14% 49.90% 35.62% 36.36% 35.27% 36.05% 36.09% 40.48% 39.46%367199272,50628,77935,158(6,379)‐8.80% 54.32% 45.65% 41.25% 29.97%31.28% 30.89% 32.13% 32.36% 36.58%367199350,63938,24729,1579,09017.95% 2.20% 49.68% 42.45% 39.07%28.98% 30.31% 30.05% 31.31% 31.57%367199460,74721,02355,315(34,292)‐56.45%‐22.63%‐17.17% 35.59% 30.43% 29.45% 21.36% 23.35% 23.81% 25.64%367199558,90938,90019,74819,15232.51%‐12.65%‐3.55%‐5.12% 35.24% 30.65% 29.72% 22.25% 24.01% 24.38%367199656,38037,23018,90118,33032.51% 32.51% 1.81% 5.42% 1.97%34.97% 30.82% 29.94% 22.97% 24.56%3671997124,68482,33541,79940,53632.51% 32.51% 32.51% 14.54% 15.03% 10.96% 34.53% 31.10% 30.32% 24.27%367199869,67446,00923,35722,65232.51% 32.51% 32.51% 32.51% 17.92% 17.92% 14.00% 34.35% 31.23% 30.49%367199987,863‐‐‐0.00% 14.38% 22.39% 24.07% 25.32%14.48% 14.83% 11.88% 30.82% 28.17%3672000‐‐‐‐NA 0.00% 14.38% 22.39% 24.07% 25.32% 14.48% 14.83% 11.88% 30.82%367200113,816241,469(1,445)‐10.46%‐10.46%‐1.42% 12.38% 20.86% 22.72%24.12% 13.75% 14.16% 11.36%3672002175,12223,11634,335(11,219)‐6.41%‐6.70%‐6.70%‐4.58% 2.88% 10.72% 13.05% 15.01% 8.30% 9.00%367200394,422‐11,601(11,601)‐12.29%‐8.47%‐8.56%‐8.56%‐6.54%‐0.37% 6.88% 9.21% 11.22% 5.68%3672004224,8859,35152,342(42,992)‐19.12%‐17.10%‐13.31%‐13.23%‐13.23%‐11.28%‐6.70%‐0.51% 1.68% 3.69%3672005431,38611,624175,430(163,806)‐37.97%‐31.51%‐29.09%‐24.80%‐24.59%‐24.59%‐22.49%‐19.00%‐13.74%‐11.70%3672006139,69945,61755,054(9,437)‐6.76%‐30.34%‐27.17%‐25.59%‐22.44%‐22.28%‐22.28%‐20.61%‐17.61%‐13.02%3672007368,41962,03616,59345,44312.33% 7.09%‐13.60%‐14.67%‐14.49%‐13.50%‐13.47%‐13.47%‐12.70%‐10.74%3672008225,10418,74065,833(47,093)‐20.92%‐0.28%‐1.51%‐15.02%‐15.68%‐15.46%‐14.51%‐14.48%‐14.48%‐13.75%3672009232,55415,90488,496(72,592)‐31.22%‐26.15%‐8.99%‐8.66%‐17.71%‐17.91%‐17.60%‐16.56%‐16.52%‐16.52%3672010100,2047,78294,073(86,291)‐86.12%‐47.75%‐36.92%‐17.33%‐15.94%‐22.29%‐21.88%‐21.38%‐20.06%‐20.00%3672011167,62824,20714,08110,1266.04%‐28.44%‐29.73%‐27.00%‐13.75%‐12.96%‐19.44%‐19.40%‐19.06%‐18.04%3672012373,68332,538137,195(104,657)‐28.01%‐17.46%‐28.19%‐28.99%‐27.34%‐17.38%‐16.46%‐21.01%‐20.82%‐20.48%Appendix E-2Page 14 of 29Transactional2- yr3- yr4- yr5- yr6- yr7- yr8- yr9- yr 10- yrTransaction HistoryRemovalNetNet Net Net Net Net Net Net Net Net NetAcctYearRetirements SalvageCostSalvageSalv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. %Southwestern Public Service Company - TexasRetirement and Salvage Analysis3681963229,63956,1921,09255,10023.99%3681964141,35436,3401,27435,06624.81% 24.30%3681965143,17931,0081,56929,43920.56% 22.67% 23.26%3681966414,38949,9232,58447,33911.42% 13.77% 16.00% 17.98%3681967232,54341,11667840,43817.39% 13.57% 14.84% 16.35% 17.86%3681968267,42575,6921,13074,56227.88% 23.00% 17.75% 18.13% 18.92% 19.74%3681969254,01159,31942658,89323.19% 25.59% 23.06% 18.94% 19.11% 19.67% 20.26%3681970297,27167,65110,76456,88719.14% 21.00% 23.25% 21.95% 18.98% 19.12% 19.58% 20.09%3681971259,99037,2936,26431,02911.93% 15.78% 18.10% 20.52% 19.97% 17.92% 18.12% 18.59% 19.14%3681972255,24510,80118510,6164.16% 8.08% 12.13% 14.76% 17.39%17.39% 16.14% 16.44% 16.96% 17.61%3681973282,56022,61071721,8937.75% 6.04% 7.96% 11.00% 13.29%15.71% 15.92% 15.09% 15.42% 15.94%3681974247,61338,2831,26537,01814.95% 11.11% 8.85% 9.62% 11.73%13.55% 15.61% 15.80% 15.08% 15.38%3681975270,36953,7971,58252,21519.31% 17.23% 13.88% 11.53% 11.61% 13.00% 14.38% 16.07% 16.20% 15.49%3681976379,20054,2095054,15914.28% 16.38% 15.98% 14.01% 12.26% 12.21% 13.24% 14.37% 15.80% 15.94%3681977280,73965,2263,08762,13922.13% 17.62% 18.11% 17.45% 15.57% 13.87% 13.62% 14.34% 15.23% 16.44%3681978430,72959,7442,88456,86013.20% 16.73% 15.88% 16.56% 16.31% 15.03% 13.74% 13.54% 14.16% 14.93%3681979561,217168,38321,279147,10426.21% 20.56% 20.91% 19.39% 19.38% 18.87% 17.59% 16.32% 15.94% 16.23%3681980484,39449,36543,8725,4931.13% 14.59% 14.19% 15.46% 15.25%15.71% 15.63% 14.88% 14.02% 13.86%3681981510,80087,31287,1881240.02% 0.56% 9.81% 10.55% 11.98%12.31% 12.96% 13.12% 12.68% 12.09%3681982332,46239,18498,018(58,834)‐17.70%‐6.96%‐4.01% 4.97% 6.50% 8.19% 8.96% 9.82% 10.19% 10.00%3681983534,09778,54317,89960,64411.35% 0.21% 0.14% 0.40% 6.38% 7.41% 8.73% 9.33% 10.04% 10.34%3681984420,41852,49312,29740,1969.56% 10.56% 3.26% 2.34% 2.09% 6.85% 7.68% 8.83% 9.35% 9.99%3681985786,258132,45540,41692,03911.71% 10.96% 11.08% 6.47% 5.19% 4.55% 7.90% 8.46% 9.35% 9.74%3681986571,22565,499187,561(122,062)‐21.37%‐2.21% 0.57% 3.06% 0.45% 0.38% 0.48% 3.92% 4.78% 5.78%36819871,579,204120,37398,24722,1261.40%‐4.65%‐0.27% 0.96% 2.39% 0.81% 0.72% 0.76% 3.23% 3.92%36819882,105,514200,054108,64291,4124.34% 3.08%‐0.20% 1.66% 2.26% 3.07% 1.98% 1.84% 1.79% 3.53%36819891,329,963212,3761,174,723(962,347)‐72.36%‐25.35%‐16.93%‐17.38%‐13.79%‐12.35%‐10.62%‐10.93%‐10.24%‐9.60%36819901,173,532148,69734,309114,3889.75%‐33.87%‐16.41%‐11.87%‐12.67%‐10.13%‐9.09%‐7.81%‐8.18%‐7.73%3681991637,922105,806184,339(78,533)‐12.31% 1.98%‐29.49%‐15.92%‐11.91%‐12.64%‐10.30%‐9.33%‐8.12%‐8.46%36819921,063,522106,894280,054(173,160)‐16.28%‐14.79%‐4.78%‐26.15%‐15.98%‐12.50%‐13.10%‐10.99%‐10.10%‐8.97%3681993842,26885,340107,096(21,756)‐2.58%‐10.23%‐10.75%‐4.28%‐22.22%‐14.40%‐11.54%‐12.15%‐10.29%‐9.49%3681994979,16498,95298,7561960.02%‐1.18%‐6.75%‐7.76%‐3.38%‐18.61%‐12.66%‐10.38%‐10.99%‐9.38%36819951,488,399199,706257,020(57,314)‐3.85%‐2.31%‐2.38%‐5.76%‐6.60%‐3.50%‐15.68%‐11.30%‐9.51%‐10.08%3681996812,790109,056140,354(31,298)‐3.85%‐3.85%‐2.70%‐2.67%‐5.46%‐6.21%‐3.54%‐14.53%‐10.72%‐9.13%36819971,191,822159,913205,807(45,894)‐3.85%‐3.85%‐3.85%‐3.00%‐2.94%‐5.16%‐5.81%‐3.58%‐13.19%‐10.02%36819981,157,648155,324199,901(44,577)‐3.85%‐3.85%‐3.85%‐3.85%‐3.18%‐3.10%‐4.96%‐5.53%‐3.62%‐12.18%368199971,292‐‐‐0.00%‐3.63%‐3.74%‐3.77%‐3.79%‐3.14%‐3.07%‐4.91%‐5.49%‐3.59%3682000350‐‐‐0.00% 0.00%‐3.63%‐3.74%‐3.77%‐3.79%‐3.14%‐3.07%‐4.91%‐5.49%36820019,198‐‐‐0.00% 0.00% 0.00%‐3.60%‐3.72%‐3.75%‐3.78%‐3.13%‐3.06%‐4.91%3682002‐‐188(188)NA‐2.04%‐1.96%‐0.23%‐3.61%‐3.73%‐3.76%‐3.79%‐3.14%‐3.06%368200313,9842822,643(22,615)‐161.71%‐163.05%‐98.36%‐96.89%‐24.05%‐5.38%‐4.63%‐4.44%‐4.25%‐3.52%368200438,44457,3379,71547,623123.88% 47.70% 47.34% 40.28% 40.05% 18.62%‐1.53%‐2.64%‐2.94%‐3.22%36820051,602,23484,56063,50921,0511.31% 4.19% 2.78% 2.77% 2.76% 2.76% 2.64% 0.04%‐1.09%‐1.55%36820063,022,289135,98013,384122,5964.06% 3.11% 4.10% 3.61% 3.60% 3.60% 3.59% 3.54% 2.09% 1.10%36820071,349,167184,921848,473(663,552)‐49.18%‐12.37%‐8.70%‐7.86%‐8.21%‐8.22%‐8.20%‐8.20%‐8.11%‐7.43%36820081,925,22323,6971,839,403(1,815,706)‐94.31%‐75.72%‐37.43%‐29.57%‐28.83%‐29.06%‐29.06%‐29.03%‐29.03%‐28.77%36820091,621,07229,82014,73415,0850.93%‐50.77%‐50.34%‐29.57%‐24.38%‐23.78%‐23.98%‐23.98%‐23.96%‐23.96%36820101,766,22840,852816,224(775,371)‐43.90%‐22.45%‐48.49%‐48.63%‐32.19%‐27.43%‐26.92%‐27.08%‐27.09%‐27.06%36820111,745,98938,626(43,877)82,5034.73%‐19.73%‐13.20%‐35.33%‐37.55%‐26.55%‐23.12%‐22.69%‐22.84%‐22.84%36820121,766,466109,63242,83366,8003.78% 4.25%‐11.86%‐8.86%‐27.50%‐30.37%‐22.49%‐19.91%‐19.54%‐19.67%Appendix E-2Page 15 of 29Transactional2- yr3- yr4- yr5- yr6- yr7- yr8- yr9- yr 10- yrTransaction HistoryRemovalNetNet Net Net Net Net Net Net Net Net NetAcctYearRetirements SalvageCostSalvageSalv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. %Southwestern Public Service Company - TexasRetirement and Salvage Analysis3691963104,67833,17030,3082,8622.73%3691964115,81325,61728,646(3,029)‐2.62%‐0.08%3691965125,18020,00032,372(12,372)‐9.88%‐6.39%‐3.63%3691966151,50619,54528,350(8,805)‐5.81%‐7.65%‐6.17%‐4.29%3691967105,50620,61728,483(7,866)‐7.46%‐6.49%‐7.60%‐6.44%‐4.85%369196898,85726,97230,572(3,600)‐3.64%‐5.61%‐5.70%‐6.79%‐5.98%‐4.68%3691969109,94224,87533,993(9,118)‐8.29%‐6.09%‐6.55%‐6.31%‐7.07%‐6.34%‐5.17%3691970111,92322,21536,852(14,637)‐13.08%‐10.71%‐8.53%‐8.26%‐7.62%‐8.02%‐7.26%‐6.13%3691971106,12123,62837,354(13,726)‐12.93%‐13.01%‐11.43%‐9.62%‐9.19%‐8.45%‐8.67%‐7.91%‐6.83%3691972105,88223,41242,421(19,009)‐17.95%‐15.44%‐14.62%‐13.02%‐11.28%‐10.65%‐9.72%‐9.74%‐8.94%‐7.87%3691973121,83827,77355,468(27,695)‐22.73%‐20.51%‐18.10%‐16.84%‐15.15%‐13.41%‐12.58%‐11.46%‐11.27%‐10.40%3691974118,48533,19355,439(22,246)‐18.78%‐20.78%‐19.92%‐18.28%‐17.25%‐15.79%‐14.23%‐13.42%‐12.30%‐12.04%3691975111,03839,30961,737(22,428)‐20.20%‐19.46%‐20.60%‐19.98%‐18.66%‐17.73%‐16.41%‐14.98%‐14.18%‐13.07%3691976126,74340,01368,461(28,448)‐22.45%‐21.40%‐20.52%‐21.09%‐20.52%‐19.35%‐18.48%‐17.25%‐15.92%‐15.12%3691977123,43937,07785,395(48,318)‐39.14%‐30.68%‐27.46%‐25.32%‐24.79%‐23.77%‐22.36%‐21.23%‐19.86%‐18.45%3691978112,75239,16190,963(51,802)‐45.94%‐42.39%‐35.42%‐31.86%‐29.24%‐28.13%‐26.82%‐25.23%‐23.92%‐22.42%3691979111,02837,553106,632(69,079)‐62.22%‐54.02%‐48.73%‐41.70%‐37.62%‐34.45%‐32.72%‐31.04%‐29.19%‐27.62%3691980105,99742,019118,952(76,933)‐72.58%‐67.28%‐59.98%‐54.31%‐47.34%‐42.98%‐39.44%‐37.25%‐35.28%‐33.21%3691981114,70936,289160,559(124,270)‐108.34%‐91.16%‐81.48%‐72.46%‐65.22%‐57.42%‐52.29%‐47.99%‐45.05%‐42.56%3691982100,81736,864162,168(125,304)‐124.29%‐115.80%‐101.55%‐91.45%‐82.04%‐74.13%‐65.89%‐60.29%‐55.49%‐52.01%3691983104,43835,202198,470(163,268)‐156.33%‐140.59%‐129.03%‐114.98%‐104.07%‐93.98%‐85.23%‐76.39%‐70.22%‐64.82%3691984116,30938,084201,701(163,617)‐140.67%‐148.08%‐140.62%‐132.13%‐120.49%‐110.59%‐101.07%‐92.48%‐83.74%‐77.49%3691985143,70543,747233,493(189,746)‐132.04%‐135.90%‐141.76%‐137.97%‐132.11%‐122.91%‐114.46%‐105.96%‐97.98%‐89.73%3691986145,01336,122235,345(199,223)‐137.38%‐134.72%‐136.43%‐140.51%‐137.83%‐133.16%‐125.44%‐117.99%‐110.28%‐102.83%3691987145,87036,168189,456(153,288)‐105.09%‐121.19%‐124.77%‐128.13%‐132.63%‐131.51%‐128.46%‐122.40%‐116.26%‐109.65%3691988133,93453,911183,884(129,973)‐97.04%‐101.24%‐113.57%‐118.24%‐122.05%‐126.59%‐126.33%‐124.27%‐119.34%‐114.15%3691989158,61256,685174,329(117,644)‐74.17%‐84.64%‐91.44%‐102.86%‐108.63%‐113.05%‐117.82%‐118.44%‐117.44%‐113.70%3691990130,58646,575185,356(138,781)‐106.28%‐88.67%‐91.32%‐94.85%‐103.49%‐108.27%‐112.14%‐116.42%‐117.09%‐116.32%3691991101,03130,493192,340(161,847)‐160.20%‐129.80%‐107.19%‐104.59%‐104.70%‐110.52%‐113.74%‐116.66%‐120.17%‐120.49%3691992107,79428,039181,111(153,072)‐142.00%‐150.81%‐133.67%‐114.72%‐110.98%‐109.87%‐114.19%‐116.60%‐118.97%‐122.00%3691993101,06627,804202,223(174,419)‐172.58%‐156.80%‐157.91%‐142.60%‐124.48%‐119.47%‐117.08%‐119.96%‐121.44%‐123.19%3691994108,45427,730217,670(189,940)‐175.13%‐173.90%‐163.07%‐162.37%‐149.03%‐132.25%‐126.64%‐123.46%‐125.24%‐126.01%369199593,11029,848123,023(93,174)‐100.07%‐140.46%‐151.19%‐148.77%‐151.03%‐141.93%‐128.50%‐124.00%‐121.44%‐123.33%3691996164,78052,823217,718(164,894)‐100.07%‐100.07%‐122.29%‐133.17%‐134.82%‐138.61%‐133.38%‐123.65%‐120.41%‐118.61%369199773,80323,65997,513(73,854)‐100.07%‐100.07%‐100.07%‐118.57%‐128.65%‐130.87%‐134.82%‐130.59%‐121.98%‐119.13%3691998107,36334,417141,855(107,437)‐100.07%‐100.07%‐100.07%‐100.07%‐114.94%‐123.92%‐126.50%‐130.47%‐127.27%‐119.93%3691999455,730‐‐‐0.00%‐19.08%‐28.46%‐43.18%‐49.10%‐62.73%‐72.78%‐78.94%‐85.19%‐87.10%3692000‐‐‐‐NA 0.00%‐19.08%‐28.46%‐43.18%‐49.10%‐62.73%‐72.78%‐78.94%‐85.19%3692001‐‐‐‐NANA 0.00%‐19.08%‐28.46%‐43.18%‐49.10%‐62.73%‐72.78%‐78.94%3692002‐‐‐‐NANANA 0.00%‐19.08%‐28.46%‐43.18%‐49.10%‐62.73%‐72.78%36920034,199‐83(83)‐1.97%‐1.97%‐1.97%‐1.97%‐0.02%‐18.95%‐28.29%‐42.97%‐48.88%‐62.47%369200441,893‐9,253(9,253)‐22.09%‐20.25%‐20.25%‐20.25%‐20.25%‐1.86%‐19.17%‐27.91%‐41.94%‐47.69%36920052,712,711257,6221,420,550(1,162,928)‐42.87%‐42.55%‐42.49%‐42.49%‐42.49%‐42.49%‐36.47%‐38.52%‐39.86%‐42.65%369200685,661‐51,841(51,841)‐60.52%‐43.41%‐43.10%‐43.03%‐43.03%‐43.03%‐43.03%‐37.09%‐39.08%‐40.37%3692007255,14162,009468,950(406,941)‐159.50%‐134.62%‐53.11%‐52.69%‐52.62%‐52.62%‐52.62%‐52.62%‐45.88%‐47.46%36920081,305,142‐290,133(290,133)‐22.23%‐44.68%‐45.50%‐43.86%‐43.66%‐43.62%‐43.62%‐43.62%‐43.62%‐39.53%3692009992,982‐274,698(274,698)‐27.66%‐24.58%‐38.06%‐38.79%‐40.86%‐40.71%‐40.68%‐40.68%‐40.68%‐40.68%36920101,182,971‐336,377(336,377)‐28.43%‐28.08%‐25.89%‐35.01%‐35.58%‐38.61%‐38.50%‐38.48%‐38.48%‐38.48%3692011313,84420,157450,568(430,411)‐137.14%‐51.23%‐41.83%‐35.09%‐42.93%‐43.29%‐43.12%‐43.00%‐42.97%‐42.97%3692012348,596‐289,687(289,687)‐83.10%‐108.70%‐57.25%‐46.90%‐39.13%‐46.11%‐46.39%‐45.06%‐44.93%‐44.90%Appendix E-2Page 16 of 29Transactional2- yr3- yr4- yr5- yr6- yr7- yr8- yr9- yr 10- yrTransaction HistoryRemovalNetNet Net Net Net Net Net Net Net Net NetAcctYearRetirements SalvageCostSalvageSalv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. %Southwestern Public Service Company - TexasRetirement and Salvage Analysis369 Overhead200340083(83)‐20.62%369 Overhead200441,8938,369(8,369)‐19.98%‐19.98%369 Overhead20051,979,080106,5251,167,131(1,060,606)‐53.59%‐52.89%‐52.89%369 Overhead200625,763‐48,848(48,848)‐189.61%‐55.34%‐54.61%‐54.61%369 Overhead2007237,6203,222462,617(459,395)‐193.33%‐192.97%‐69.96%‐69.04%‐69.04%369 Overhead20081,292,588‐288,194(288,194)‐22.30%‐48.86%‐51.19%‐52.53%‐52.15%‐52.15%369 Overhead2009985,772‐271,680(271,680)‐27.56%‐24.57%‐40.51%‐42.02%‐47.09%‐46.84%‐46.84%369 Overhead20101,172,367‐329,283(329,283)‐28.09%‐27.85%‐25.77%‐36.56%‐37.62%‐43.17%‐43.01%‐43.00%369 Overhead2011296,53534,600446,408(411,808)‐138.87%‐50.45%‐41.26%‐34.72%‐44.18%‐45.11%‐47.91%‐47.72%‐47.72%369 Overhead2012333,081‐282,789(282,789)‐84.90%‐110.32%‐56.82%‐46.47%‐38.81%‐47.32%‐48.16%‐49.86%‐49.66%‐49.66%369 Underground369 Underground20033,799‐0.00%369 Underground2004‐‐884(884)NA‐23.26%369 Underground2005733,630151,097253,418(102,322)‐13.95%‐14.07%‐14.00%369 Underground200659,898‐2,993(2,993)‐5.00%‐13.27%‐13.38%‐13.32%369 Underground200717,52158,7876,33352,454299.37% 63.89%‐6.52%‐6.63%‐6.60%369 Underground200812,554‐1,939(1,939)‐15.45% 167.96% 52.82%‐6.65%‐6.76%‐6.73%369 Underground20097,210‐3,017(3,017)‐41.85%‐25.08% 127.39% 45.80%‐6.96%‐7.07%‐7.03%369 Underground201010,603‐7,094(7,094)‐66.90%‐56.76%‐39.68% 84.37% 34.71%‐7.71%‐7.82%‐7.78%369 Underground201117,309(14,443)4,160(18,602)‐107.47%‐92.06%‐81.75%‐64.29% 33.44% 15.04%‐9.73%‐9.83%‐9.78%369 Underground201215,514‐6,898(6,898)‐44.46%‐77.69%‐75.06%‐70.33%‐59.43% 18.46% 8.47%‐10.34%‐10.44%‐10.40%Appendix E-2Page 17 of 29Transactional2- yr3- yr4- yr5- yr6- yr7- yr8- yr9- yr 10- yrTransaction HistoryRemovalNetNet Net Net Net Net Net Net Net Net NetAcctYearRetirements SalvageCostSalvageSalv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. %Southwestern Public Service Company - TexasRetirement and Salvage Analysis370196385,0415,2902,2533,0373.57%370196492,6766,6502,6504,0004.32% 3.96%370196589,6784,8661,8802,9863.33% 3.83% 3.75%3701966104,09413,5471,39612,15111.67% 7.81% 6.68% 5.97%3701967115,3752,9209032,0171.75% 6.46% 5.55% 5.26% 4.97%3701968115,5596,6601,4285,2324.53% 3.14% 5.79% 5.27% 5.10% 4.88%3701969100,5716,9911,2065,7855.75% 5.10% 3.93% 5.78% 5.36% 5.21% 5.01%3701970123,0416,3513,2493,1022.52% 3.97% 4.16% 3.55% 5.06% 4.82% 4.76% 4.64%370197192,7086,0071,9464,0614.38% 3.32% 4.09% 4.21% 3.69% 4.97% 4.77% 4.72% 4.61%3701972115,4315,8142,1643,6503.16% 3.70% 3.26% 3.84% 3.99% 3.60% 4.69% 4.55% 4.53% 4.45%3701973102,6875,1102,0243,0863.01% 3.09% 3.47% 3.20% 3.68% 3.83% 3.52% 4.50% 4.39% 4.38%370197474,4604,9302,5862,3443.15% 3.07% 3.10% 3.41% 3.20% 3.62% 3.76% 3.49% 4.39% 4.30%370197592,76810,3041,8638,4419.10% 6.45% 5.14% 4.55% 4.51% 4.11% 4.34% 4.37% 4.04% 4.81%3701976106,74410,2482,3697,8797.38% 8.18% 6.81% 5.77% 5.16% 5.04% 4.60% 4.74% 4.72% 4.39%3701977153,64010,0454,5485,4973.58% 5.14% 6.18% 5.65% 5.14% 4.78% 4.73% 4.42% 4.56% 4.55%3701978129,1229,2554,2584,9973.87% 3.71% 4.72% 5.56% 5.24% 4.89% 4.63% 4.61% 4.35% 4.48%3701979126,5489,2994,2175,0824.02% 3.94% 3.81% 4.55% 5.24% 5.01% 4.75% 4.55% 4.53% 4.31%3701980116,8278,4097,0021,4071.20% 2.67% 3.08% 3.23% 3.93% 4.59% 4.46% 4.29% 4.16% 4.18%3701981158,9379,1798,9302490.16% 0.60% 1.67% 2.21% 2.52% 3.17% 3.79% 3.74% 3.67% 3.62%3701982156,0156,5595,7018580.55% 0.35% 0.58% 1.36% 1.83% 2.15% 2.74% 3.31% 3.30% 3.27%3701983156,48410,48410,0704140.26% 0.41% 0.32% 0.50% 1.12% 1.54% 1.85% 2.39% 2.91% 2.92%3701984160,1782,6966,512(3,816)‐2.38%‐1.07%‐0.54%‐0.36%‐0.12% 0.48% 0.92% 1.27% 1.78% 2.28%3701985204,32138,8987,28731,61115.47% 7.63% 5.41% 4.29% 3.51% 3.22% 3.32% 3.38% 3.40% 3.69%3701986330,80215,9999,9326,0671.83% 7.04% 4.87% 4.02% 3.49% 3.03% 2.87% 2.97% 3.04% 3.09%3701987221,7568,8489,520(672)‐0.30% 0.98% 4.89% 3.62% 3.13% 2.80% 2.50% 2.40% 2.52% 2.62%370198895,89112,16716,297(4,130)‐4.31%‐1.51% 0.20% 3.86% 2.87% 2.52% 2.29% 2.06% 2.00% 2.15%3701989177,3837,01011,964(4,954)‐2.79%‐3.32%‐1.97%‐0.45% 2.71% 2.03% 1.82% 1.69% 1.54% 1.52%3701990288,0355,0595,996(937)‐0.33%‐1.27%‐1.79%‐1.37%‐0.42% 2.05% 1.57% 1.44% 1.36% 1.27%3701991352,27610,5248,2182,3060.65% 0.21%‐0.44%‐0.84%‐0.74%‐0.16% 1.75% 1.39% 1.30% 1.25%3701992367,7684,10211,900(7,798)‐2.12%‐0.76%‐0.64%‐0.96%‐1.21%‐1.08%‐0.55% 1.05% 0.80% 0.77%3701993475,1143,1285,900(2,772)‐0.58%‐1.25%‐0.69%‐0.62%‐0.85%‐1.04%‐0.96%‐0.56% 0.74% 0.56%3701994435,0893,1568,895(5,739)‐1.32%‐0.94%‐1.28%‐0.86%‐0.78%‐0.95%‐1.10%‐1.02%‐0.68% 0.44%3701995325,44514,95311,4943,4591.06%‐0.30%‐0.41%‐0.80%‐0.54%‐0.51%‐0.68%‐0.82%‐0.78%‐0.49%3701996948,07843,56033,48310,0761.06% 1.06% 0.46% 0.23%‐0.11%‐0.02%‐0.04%‐0.19%‐0.30%‐0.30%37019971,102,28350,64538,92911,7151.06% 1.06% 1.06% 0.69% 0.51% 0.24% 0.28% 0.24% 0.12% 0.03%37019981,102,28350,64538,92911,7151.06% 1.06% 1.06% 1.06% 0.80% 0.65% 0.43% 0.45% 0.41% 0.31%3701999‐‐‐‐NA 1.06% 1.06% 1.06% 1.06% 0.80% 0.65% 0.43% 0.45% 0.41%3702000‐‐‐‐NANA 1.06% 1.06% 1.06% 1.06% 0.80% 0.65% 0.43% 0.45%3702001‐‐‐‐NANANA 1.06% 1.06% 1.06% 1.06% 0.80% 0.65% 0.43%370200278103,214103,214‐0.00% 0.00% 0.00% 0.00% 1.06% 1.06% 1.06% 1.06% 0.80% 0.65%3702003‐‐‐‐NA 0.00% 0.00% 0.00% 0.00% 1.06% 1.06% 1.06% 1.06% 0.80%3702004‐‐‐‐NANA 0.00% 0.00% 0.00% 0.00% 1.06% 1.06% 1.06% 1.06%37020051,135,066‐‐‐0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.52% 0.70% 0.78%37020061,592,930‐13,640(13,640)‐0.86%‐0.50%‐0.50%‐0.50%‐0.50%‐0.50%‐0.50%‐0.50%‐0.05% 0.20%37020073,656,069‐968,429(968,429)‐26.49%‐18.71%‐15.38%‐15.38%‐15.38%‐15.38%‐15.38%‐15.38%‐15.38%‐12.96%37020081,762,801‐‐‐0.00%‐17.87%‐14.01%‐12.05%‐12.05%‐12.05%‐12.05%‐12.05%‐12.05%‐12.05%37020092,086,694‐‐‐0.00% 0.00%‐12.90%‐10.79%‐9.60%‐9.60%‐9.60%‐9.60%‐9.60%‐9.60%37020101,607,483‐644,593(644,593)‐40.10%‐17.45%‐11.81%‐17.70%‐15.19%‐13.74%‐13.74%‐13.74%‐13.74%‐13.74%37020113,944,904‐‐‐0.00%‐11.61%‐8.44%‐6.86%‐12.35%‐11.10%‐10.30%‐10.30%‐10.30%‐10.30%37020121,275,813‐‐‐0.00% 0.00%‐9.44%‐7.23%‐6.04%‐11.25%‐10.21%‐9.53%‐9.53%‐9.53%Appendix E-2Page 18 of 29Transactional2- yr3- yr4- yr5- yr6- yr7- yr8- yr9- yr 10- yrTransaction HistoryRemovalNetNet Net Net Net Net Net Net Net Net NetAcctYearRetirements SalvageCostSalvageSalv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. %Southwestern Public Service Company - TexasRetirement and Salvage Analysis371196650,66518,0476,24711,80023.29%371196747,37220,6446,65413,99029.53% 26.31%371196853,83813,5358,2945,2419.73% 19.00% 20.43%371196955,55613,4989,5613,9377.09% 8.39% 14.78% 16.86%371197046,7627,1599,331(2,172)‐4.64% 1.73% 4.49% 10.32% 12.90%371197147,88013,56515,981(2,416)‐5.05%‐4.85%‐0.43% 2.25% 7.39% 10.06%371197245,62015,69910,9674,73210.37% 2.48% 0.10% 2.08% 3.73% 7.85% 10.10%371197349,63717,8339,5898,24416.61% 13.62% 7.38% 4.42% 5.02% 5.87% 9.10% 10.91%371197449,65722,07911,76210,31720.78% 18.69% 16.07% 10.83% 7.81% 7.67% 7.99% 10.57% 12.01%371197544,26926,99213,18513,80731.19% 25.68% 22.55% 19.61% 14.63% 11.45% 10.74% 10.60% 12.64% 13.74%371197651,40832,16916,59815,57130.29% 30.71% 27.31% 24.59% 21.89% 17.42% 14.34% 13.31% 12.88% 14.48%371197753,63530,51421,4609,05416.88% 23.44% 25.74% 24.50% 22.93% 20.98% 17.34% 14.69% 13.74% 13.31%371197874,43936,02232,8813,1414.22% 9.52% 15.47% 18.58% 18.98%18.61% 17.59% 14.99% 13.01% 12.38%371197991,61857,66845,56012,10813.22% 9.18% 11.06% 14.71% 17.02%17.53% 17.42% 16.72% 14.67% 13.04%3711980135,78182,86566,47416,39112.07% 12.53% 10.48% 11.45% 13.83% 15.53% 16.05% 16.10% 15.66% 14.12%3711981228,237128,802107,14621,6569.49% 10.45% 11.01% 10.05% 10.68%12.27% 13.50% 14.00% 14.16% 13.95%3711982175,040102,823110,408(7,585)‐4.33% 3.49% 5.65% 6.75% 6.48% 7.22% 8.68% 9.85% 10.45% 10.77%3711983213,671106,842129,150(22,308)‐10.44%‐7.69%‐1.34% 1.08% 2.40% 2.55% 3.34% 4.69% 5.79% 6.46%3711984280,059105,812172,034(66,222)‐23.65%‐17.93%‐14.37%‐8.30%‐5.62%‐4.09%‐3.57%‐2.70%‐1.40%‐0.33%3711985498,543135,347192,687(57,340)‐11.50%‐15.87%‐14.70%‐13.15%‐9.44%‐7.54%‐6.36%‐5.90%‐5.20%‐4.19%3711986267,670115,320202,767(87,447)‐32.67%‐18.90%‐20.17%‐18.52%‐16.79%‐13.18%‐11.28%‐10.09%‐9.55%‐8.84%3711987323,785110,418225,693(115,275)‐35.60%‐34.28%‐23.86%‐23.82%‐22.01%‐20.25%‐16.84%‐14.99%‐13.82%‐13.23%3711988261,27390,521219,561(129,040)‐49.39%‐41.76%‐38.91%‐28.80%‐27.91%‐25.89%‐24.02%‐20.62%‐18.76%‐17.57%3711989304,006114,089299,746(185,657)‐61.07%‐55.67%‐48.36%‐44.73%‐34.72%‐33.12%‐30.86%‐28.87%‐25.44%‐23.54%3711990298,19295,256301,745(206,489)‐69.25%‐65.12%‐60.36%‐53.61%‐49.76%‐39.99%‐37.94%‐35.54%‐33.46%‐30.02%3711991241,34196,183274,771(178,588)‐74.00%‐71.37%‐67.66%‐63.34%‐57.05%‐53.20%‐43.73%‐41.46%‐38.99%‐36.88%3711992324,525116,929336,322(219,393)‐67.60%‐70.33%‐69.96%‐67.64%‐64.31%‐59.01%‐55.52%‐46.81%‐44.49%‐42.08%3711993273,55184,874274,360(189,486)‐69.27%‐68.37%‐69.99%‐69.79%‐67.95%‐65.10%‐60.39%‐57.16%‐49.01%‐46.70%3711994374,474110,599333,446(222,847)‐59.51%‐63.63%‐64.96%‐66.75%‐67.25%‐66.21%‐64.10%‐60.25%‐57.49%‐50.25%371199529,66011,81422,209(10,395)‐35.05%‐57.71%‐62.38%‐64.07%‐66.00%‐66.63%‐65.71%‐63.69%‐59.95%‐57.24%3711996138,87955,318103,990(48,672)‐35.05%‐35.05%‐51.92%‐57.73%‐60.54%‐62.89%‐64.02%‐63.56%‐61.92%‐58.60%3711997104,32341,55478,115(36,562)‐35.05%‐35.05%‐35.05%‐49.20%‐55.16%‐58.40%‐60.93%‐62.32%‐62.14%‐60.72%371199828,43811,32721,294(9,967)‐35.05%‐35.05%‐35.05%‐35.05%‐48.60%‐54.56%‐57.88%‐60.45%‐61.90%‐61.78%3711999105,483‐‐‐0.00%‐7.44%‐19.53%‐25.24%‐25.96%‐42.04%‐49.10%‐53.45%‐56.51%‐58.49%3712000‐‐‐‐NA 0.00%‐7.44%‐19.53%‐25.24%‐25.96%‐42.04%‐49.10%‐53.45%‐56.51%371200122,040‐‐‐0.00% 0.00% 0.00%‐6.39%‐17.88%‐23.85%‐24.62%‐40.89%‐48.10%‐52.61%3712002222,87924,63425,629(995)‐0.45%‐0.41%‐0.41%‐0.28%‐2.89%‐9.84%‐15.46%‐16.36%‐32.10%‐39.93%371200328,625‐2,647(2,647)‐9.25%‐1.45%‐1.33%‐1.33%‐0.96%‐3.34%‐9.80%‐15.19%‐16.06%‐31.48%3712004144,321‐35,720(35,720)‐24.75%‐22.18%‐9.94%‐9.42%‐9.42%‐7.52%‐8.94%‐13.09%‐16.93%‐17.58%3712005353,445‐36,254(36,254)‐10.26%‐14.46%‐14.18%‐10.09%‐9.80%‐9.80%‐8.62%‐9.45%‐12.10%‐14.87%3712006104,725‐29,289(29,289)‐27.97%‐14.31%‐16.81%‐16.46%‐12.28%‐11.97%‐11.97%‐10.69%‐11.37%‐13.59%371200725,42812,76336,309(23,546)‐92.60%‐40.59%‐18.42%‐19.88%‐19.41%‐14.61%‐14.25%‐14.25%‐12.76%‐13.37%371200811,3482057,381(7,176)‐63.24%‐83.54%‐42.41%‐19.45%‐20.65%‐20.16%‐15.23%‐14.86%‐14.86%‐13.32%37120092,409‐3,529(3,529)‐146.48%‐77.81%‐87.41%‐44.15%‐20.06%‐21.12%‐20.61%‐15.58%‐15.20%‐15.20%371201036,441‐16,528(16,528)‐45.36%‐51.63%‐54.25%‐67.15%‐44.40%‐21.79%‐22.42%‐21.89%‐16.75%‐16.36%371201117,357‐16,482(16,482)‐94.96%‐61.36%‐65.01%‐64.71%‐72.34%‐48.83%‐24.10%‐24.23%‐23.64%‐18.18%371201241,007366,459(6,424)‐15.66%‐39.25%‐41.59%‐44.19%‐46.18%‐54.99%‐43.14%‐23.51%‐23.75%‐23.21%Appendix E-2Page 19 of 29Transactional2- yr3- yr4- yr5- yr6- yr7- yr8- yr9- yr 10- yrTransaction HistoryRemovalNetNet Net Net Net Net Net Net Net Net NetAcctYearRetirements SalvageCostSalvageSalv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. %Southwestern Public Service Company - TexasRetirement and Salvage Analysis373196395,6473,4442,1641,2801.34%3731964149,6569,0153,1305,8853.93% 2.92%373196562,4403,6911,4022,2893.67% 3.85% 3.07%3731966127,92415,3144,75310,5618.26% 6.75% 5.51% 4.59%3731967243,8179,2066,9842,2220.91% 3.44% 3.47% 3.59% 3.27%3731968125,01318,84312,2536,5905.27% 2.39% 3.90% 3.87% 3.89% 3.58%3731969124,90428,39818,4019,9978.00% 6.64% 3.81% 4.72% 4.63% 4.50% 4.18%3731970116,43814,04214,795(753)‐0.65% 3.83% 4.32% 2.96% 3.88% 3.86% 3.87% 3.64%373197168,2723951182770.41%‐0.26% 3.08% 3.71% 2.70% 3.58% 3.59% 3.64% 3.44%373197277,3482,1703121,8582.40% 1.47% 0.53% 2.94% 3.51% 2.67% 3.48% 3.49% 3.55% 3.37%3731973125,3636,6551,8834,7723.81% 3.27% 2.55% 1.59% 3.15% 3.57% 2.83% 3.52% 3.53% 3.58%373197462,5508,3289,554(1,226)‐1.96% 1.89% 2.04% 1.70% 1.10% 2.60% 3.07% 2.52% 3.20% 3.23%373197532,73613,2595,6517,60823.24% 6.70% 5.06% 4.37% 3.63% 2.60% 3.71% 3.98% 3.21% 3.79%373197634,42413,1163,2059,91128.79% 26.09% 12.56% 8.26% 6.90% 5.79% 4.34% 5.05% 5.09% 4.08%373197756,83621,47512,3689,10716.02% 20.84% 21.47% 13.62% 9.67% 8.23% 7.06% 5.50% 5.95% 5.84%373197825,79112,5838,2554,32816.78% 16.26% 19.95% 20.67% 14.00%10.22% 8.76% 7.58% 5.98% 6.33%373197923,17710,6667,7552,91112.56% 14.78% 15.45% 18.72% 19.58%13.86% 10.37% 8.96% 7.81% 6.23%373198068,30620,47113,4976,97410.21% 10.81% 12.12% 13.39% 15.94%16.93% 13.04% 10.34% 9.13% 8.09%373198126,73218,85711,7127,14526.73% 14.86% 14.41% 14.83% 15.17% 17.16% 17.90% 14.15% 11.30% 10.01%373198287,6988,90015,045(6,145)‐7.01% 0.87% 4.36% 5.29% 6.57% 8.43% 10.60% 11.76% 9.71% 8.35%373198337,153147,36326,409120,954325.56% 91.96% 80.45% 58.63% 54.24% 50.65% 44.60% 43.09% 41.44% 35.48%373198459,41699,67525,55074,125124.76% 202.01% 102.53% 92.93% 72.70% 68.09% 64.06% 56.97% 54.66% 52.38%373198596,01282,56333,45649,10751.15% 79.29% 126.80% 84.93% 79.86% 67.19% 64.01% 61.14% 55.81% 54.00%373198677,373114,07053,70060,37078.02% 63.14% 78.87% 112.82% 83.44% 79.49% 69.04% 66.29% 63.74% 58.89%373198782,44084,65654,98929,66735.99% 56.34% 54.39% 67.65% 94.84% 74.55% 71.81% 63.95% 61.81% 59.82%373198853,13166,33751,77914,55827.40% 32.62% 49.12% 49.75% 61.85% 86.01% 69.47% 67.27% 60.65% 58.82%3731989108,621112,03994,62217,41716.03% 19.77% 25.24% 37.94% 40.98% 51.41% 71.22% 59.82% 58.42% 53.69%3731990134,898117,546118,659(1,113)‐0.83% 6.70% 10.40% 15.97% 26.49%30.77% 39.90% 56.25% 48.72% 47.95%373199146,99886,37857,49728,88161.45% 15.27% 15.55% 17.38% 20.98% 29.75% 33.18% 41.44% 56.60% 49.48%373199248,81270,69566,0024,6939.61% 35.04% 14.07% 14.70% 16.42%19.82% 27.97% 31.40% 39.24% 53.52%373199345,52426,79639,820(13,024)‐28.61%‐8.83% 14.54% 7.04% 9.58% 11.74% 15.58% 23.66% 27.47% 35.14%373199444,51463,14049,79613,34429.98% 0.36% 3.61% 18.24% 10.22%11.69% 13.42% 16.71% 24.10% 27.62%373199563,13060,53338,33822,19535.16% 33.02% 14.70% 13.47% 22.53% 14.32% 14.70% 15.94% 18.57% 25.09%3731996110,452105,90867,07638,83235.16% 35.16% 34.10% 23.27% 21.14% 26.41% 18.98% 18.45% 19.17% 21.05%373199771,18968,26043,23225,02835.16% 35.16% 35.16% 34.36% 25.80% 23.74% 27.85% 21.01% 20.21% 20.74%373199828,51027,33717,31410,02335.16% 35.16% 35.16% 35.16% 34.43% 26.53% 24.53% 28.31% 21.69% 20.82%3731999110,180‐‐‐0.00% 7.23% 16.70% 23.06% 25.06%25.57% 20.36% 19.35% 22.83% 18.30%3732000‐‐‐‐NA 0.00% 7.23% 16.70% 23.06% 25.06% 25.57% 20.36% 19.35% 22.83%373200123,1342,16111,284(9,122)‐39.43%‐39.43%‐6.84% 0.56% 11.13% 18.86%21.39% 22.23% 17.57% 16.86%3732002186,4854,04312,153(8,111)‐4.35%‐8.22%‐8.22%‐5.39%‐2.07% 4.25% 10.69%13.29% 14.46% 11.59%373200347,889‐15,494(15,494)‐32.35%‐10.07%‐12.71%‐12.71%‐8.90%‐5.73% 0.50% 7.12% 9.88% 11.19%3732004314,751‐113,113(113,113)‐35.94%‐35.46%‐24.90%‐25.48%‐25.48%‐21.37%‐19.10%‐14.16%‐8.06%‐5.21%3732005428,676‐181,832(181,832)‐42.42%‐39.67%‐39.23%‐32.58%‐32.74%‐32.74%‐29.49%‐27.87%‐24.17%‐19.21%3732006700,500‐334,979(334,979)‐47.82%‐45.77%‐43.63%‐43.26%‐38.94%‐38.95%‐38.95%‐36.58%‐35.47%‐32.84%3732007207,35483,763464,535(380,772)‐183.63%‐78.84%‐67.16%‐61.21%‐60.39%‐54.85%‐54.66%‐54.66%‐51.68%‐50.47%37320081,073,2465,375472,455(467,080)‐43.52%‐66.21%‐59.71%‐56.63%‐54.24%‐53.86%‐50.74%‐50.65%‐50.65%‐48.85%3732009656,66365,428462,899(397,471)‐60.53%‐49.98%‐64.28%‐59.91%‐57.47%‐55.46%‐55.14%‐52.52%‐52.44%‐52.44%3732010477,7699,626470,575(460,949)‐96.48%‐75.67%‐60.04%‐70.65%‐65.52%‐62.72%‐60.54%‐60.19%‐57.65%‐57.55%3732011290,61452,509480,074(427,565)‐147.12%‐115.63%‐90.24%‐70.17%‐78.87%‐72.48%‐69.12%‐66.60%‐66.21%‐63.58%3732012872,18536385,543(385,507)‐44.20%‐69.92%‐77.66%‐72.76%‐63.45%‐70.42%‐66.72%‐64.50%‐62.71%‐62.43%Appendix E-2Page 20 of 29Transactional2- yr3- yr4- yr5- yr6- yr7- yr8- yr9- yr 10- yrTransaction HistoryRemovalNetNet Net Net Net Net Net Net Net Net NetAcctYearRetirements SalvageCostSalvageSalv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. %Southwestern Public Service Company - TexasRetirement and Salvage Analysis3891995‐‐‐‐NANA3891996‐‐‐‐NANANA3891997‐‐‐‐NANANANA3891998‐‐‐‐NANANANANA3891999‐‐‐‐NANANANANANA3892000‐‐‐‐NANANANANANANA3892001‐‐‐‐NANANANANANANANA3892002‐‐‐‐NANANANANANANANANA3892003‐‐‐‐NANANANANANANANANANA3892004‐‐‐‐NANANANANANANANANANA3892005‐‐‐‐NANANANANANANANANANA3892006‐‐‐‐NANANANANANANANANANA3892007‐‐‐‐NANANANANANANANANANA3892008‐‐‐‐NANANANANANANANANANA3892009‐‐‐‐NANANANANANANANANANA3892010‐‐‐‐NANANANANANANANANANA3892011‐‐‐‐NANANANANANANANANANA3892012‐‐‐‐NANANANANANANANANANAAppendix E-2Page 21 of 29Transactional2- yr3- yr4- yr5- yr6- yr7- yr8- yr9- yr 10- yrTransaction HistoryRemovalNetNet Net Net Net Net Net Net Net Net NetAcctYearRetirements SalvageCostSalvageSalv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. %Southwestern Public Service Company - TexasRetirement and Salvage Analysis390197729,4812,3526,289(3,937)‐13.35%390197853,2961,0673,914(2,847)‐5.34%‐8.20%3901979165,23936,2966,32429,97218.14% 12.41% 9.35%39019807,4937341355997.99% 17.70% 12.27% 9.31%390198125,8921,1529701820.70% 2.34% 15.48% 11.08% 8.52%3901982111,2701,2271,880(653)‐0.59%‐0.34% 0.09% 9.71% 7.50% 5.94%390198346,6154431,154(711)‐1.53%‐0.86%‐0.64%‐0.30% 8.24% 6.48% 5.15%3901984110,76811,4612,2679,1948.30% 5.39% 2.91% 2.72% 2.85% 8.26% 6.86% 5.78%390198535,4462704,853(4,583)‐12.93% 3.15% 2.02% 1.07% 1.04% 1.19% 6.76% 5.60% 4.65%390198652,95892594(502)‐0.95%‐5.75% 2.06% 1.38% 0.77% 0.76% 0.90% 6.03% 5.03% 4.18%3901987194,632164,5612,188162,37383.43% 65.38% 55.57% 42.28% 37.64% 29.93% 28.62% 28.36% 26.11% 24.02%3901988193,674‐7,052(7,052)‐3.64% 40.00% 35.09% 31.52% 27.14%25.03% 21.21% 20.52% 20.40% 20.00%3901989174,77591,71426,72564,98937.18% 15.72% 39.13% 35.68% 33.04% 29.44% 27.66% 24.24% 23.60% 23.47%3901990197,26720,61543,708(23,093)‐11.71% 11.26% 6.16% 25.94% 24.19%22.64% 20.98% 19.94% 17.90% 17.51%3901991295,84616,740221,664(204,924)‐69.27%‐46.24%‐24.41%‐19.74%‐0.73%‐0.74%‐1.12%‐0.29%‐0.33%‐0.35%390199293,213‐22,580(22,580)‐24.22%‐58.48%‐42.74%‐24.39%‐20.18%‐2.64%‐2.56%‐2.86%‐1.94%‐1.93%3901993128,05924217,234(16,992)‐13.27%‐17.88%‐47.28%‐37.46%‐22.79%‐19.36%‐3.70%‐3.59%‐3.83%‐2.92%3901994361,90339,16754,381(15,214)‐4.20%‐6.57%‐9.39%‐29.55%‐26.28%‐17.41%‐15.56%‐3.81%‐3.72%‐3.91%3901995183,425(652)27,553(28,205)‐15.38%‐7.96%‐8.97%‐10.83%‐27.10%‐24.69%‐17.15%‐15.54%‐4.98%‐4.86%3901996299,410(8,592)72,903(81,495)‐27.22%‐22.72%‐14.79%‐14.59%‐15.43%‐27.13%‐25.17%‐18.89%‐17.36%‐8.11%3901997556,505‐5,606(5,606)‐1.01%‐10.18%‐11.09%‐9.31%‐9.65%‐10.48%‐19.55%‐18.82%‐14.54%‐13.69%3901998185,745‐‐‐0.00%‐0.76%‐8.36%‐9.41%‐8.22%‐8.60%‐9.41%‐17.82%‐17.30%‐13.45%39019995,398‐‐‐0.00% 0.00%‐0.75%‐8.32%‐9.37%‐8.20%‐8.57%‐9.38%‐17.78%‐17.26%3902000168,51395,6288,02387,60451.99% 50.37% 24.36% 8.95% 0.04%‐1.98%‐2.44%‐3.17%‐4.16%‐12.62%3902001210,977‐‐‐0.00% 23.08% 22.76% 15.35% 7.27% 0.04%‐1.72%‐2.18%‐2.85%‐3.76%3902002351,14739,90049,864(9,964)‐2.84%‐1.77% 10.63% 10.55% 8.42% 4.87%‐0.53%‐1.92%‐2.28%‐2.85%3902003526,407324,547108,874215,67240.97% 23.44% 18.90% 23.33% 23.23%20.25% 14.35% 8.95% 7.16% 5.71%390200431,815(18,779)‐(18,779)‐59.03% 35.27% 20.56% 16.68% 21.30%21.21% 18.55% 13.21% 8.02% 6.32%3902005478,9562601,500(1,240)‐0.26%‐3.92% 18.86% 13.38% 11.61% 15.46% 15.41% 13.95% 10.64% 6.61%390200656,178341,312631,302(289,989)‐516.19%‐54.42%‐54.68%‐8.63%‐7.22%‐6.30%‐0.92%‐0.91%‐0.83%‐0.87%390200793,709(1,035)22,854(23,889)‐25.49%‐209.41%‐50.11%‐50.54%‐9.96%‐8.33%‐7.33%‐2.12%‐2.11%‐1.92%3902008121,615‐14,873(14,873)‐12.23%‐18.00%‐121.09%‐43.97%‐44.58%‐10.17%‐8.62%‐7.65%‐2.72%‐2.71%390200931,950‐9,068(9,068)‐28.38%‐15.59%‐19.34%‐111.33%‐43.34%‐43.95%‐10.60%‐8.99%‐8.00%‐3.12%3902010‐‐‐‐NA‐28.38%‐15.59%‐19.34%‐111.33%‐43.34%‐43.95%‐10.60%‐8.99%‐8.00%39020111,204,983‐337,193(337,193)‐27.98%‐27.98%‐27.99%‐26.58%‐26.51%‐44.75%‐34.03%‐34.42%‐18.83%‐16.89%3902012612,960100287,445(287,345)‐46.88%‐34.35%‐34.35%‐34.25%‐32.89%‐32.56%‐45.36%‐37.06%‐37.32%‐24.27%Appendix E-2Page 22 of 29Transactional2- yr3- yr4- yr5- yr6- yr7- yr8- yr9- yr 10- yrTransaction HistoryRemovalNetNet Net Net Net Net Net Net Net Net NetAcctYearRetirements SalvageCostSalvageSalv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. %Southwestern Public Service Company - TexasRetirement and Salvage Analysis391198832,100565‐5651.76%3911989105,5333,068‐3,0682.91% 2.64%391199064,1112,3761062,2703.54% 3.15% 2.93%3911991111,6638,132‐8,1327.28% 5.92% 4.79% 4.48%391199273,1395771,862(1,285)‐1.76% 3.71% 3.66% 3.44% 3.30%391199348,357225‐2250.47%‐0.87% 3.03% 3.14% 3.08% 2.98%391199435,118‐220(220)‐0.63% 0.01%‐0.82% 2.55% 2.74% 2.78% 2.71%391199521,8352,670‐2,67012.23% 4.30% 2.54% 0.78% 3.28% 3.33% 3.23% 3.14%391199627,924926‐9263.32% 7.23% 3.98% 2.70% 1.12% 3.29% 3.33% 3.24% 3.15%3911997494,556‐‐‐0.00% 0.18% 0.66% 0.58% 0.57% 0.33% 1.29% 1.45% 1.61% 1.61%391199876,609‐‐‐0.00% 0.00% 0.15% 0.58% 0.51% 0.51% 0.30% 1.17% 1.33% 1.49%3911999470,070‐‐‐0.00% 0.00% 0.00% 0.09% 0.33% 0.30% 0.31% 0.19% 0.77% 0.89%391200029,174‐‐‐0.00% 0.00% 0.00% 0.00% 0.08% 0.32% 0.29% 0.30% 0.18% 0.75%3912001181,403‐‐‐0.00% 0.00% 0.00% 0.00% 0.00% 0.07% 0.28% 0.25% 0.26% 0.16%391200256,331‐2,920(2,920)‐5.18%‐1.23%‐1.09%‐0.40%‐0.36%‐0.22%‐0.15% 0.05% 0.03% 0.05%3912003563,78027,82811,64816,1802.87% 2.14% 1.65% 1.60% 1.02% 0.96% 0.71% 0.75% 0.88% 0.85%391200476,621131‐1310.17% 2.55% 1.92% 1.52% 1.48% 0.97% 0.92% 0.69% 0.72% 0.85%391200513,281330‐3302.49% 0.51% 2.55% 1.93% 1.54% 1.49% 0.99% 0.94% 0.70% 0.74%39120067,33175‐751.02% 1.97% 0.55% 2.53% 1.92% 1.54% 1.49% 0.99% 0.94% 0.70%3912007‐265‐265NA 4.64% 3.25% 0.82% 2.57% 1.96% 1.56% 1.52% 1.01% 0.95%39120083,062‐‐‐0.00% 8.65% 3.27% 2.83% 0.80% 2.56% 1.95% 1.56% 1.51% 1.00%391200967,584‐‐‐0.00% 0.00% 0.38% 0.44% 0.73% 0.48% 2.32% 1.78% 1.45% 1.41%3912010‐‐‐‐NA 0.00% 0.00% 0.38% 0.44% 0.73% 0.48% 2.32% 1.78% 1.45%3912011‐‐9,601(9,601)NA NA‐14.21%‐13.59%‐13.22%‐11.88%‐9.79%‐5.24% 1.01% 0.57%3912012‐‐1,405(1,405)NA NA NA‐16.29%‐15.58%‐15.21%‐13.68%‐11.33%‐6.08% 0.82%391.02 20067,0399213,223(13,131)‐186.56%391.022007‐40535NA‐186.06%391.022008‐‐‐‐NANA‐186.06%391.022009‐‐‐‐NANANA‐186.06%391.022010‐‐‐‐NANANANA‐186.06%391.0220113,053,117‐‐‐0.00% 0.00% 0.00% 0.00% 0.00%‐0.43%391.02201211,585,344(3,461)5,648‐0.00% 0.00% 0.00% 0.00% 0.00% 0.00%‐0.09%Appendix E-2Page 23 of 29Transactional2- yr3- yr4- yr5- yr6- yr7- yr8- yr9- yr 10- yrTransaction HistoryRemovalNetNet Net Net Net Net Net Net Net Net NetAcctYearRetirements SalvageCostSalvageSalv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. %Southwestern Public Service Company - TexasRetirement and Salvage Analysis3921968271,02552,2733552,23819.27%3921969440,17297,7141597,69922.20% 21.08%3921970510,478101,122672100,45019.68% 20.84% 20.50%3921971504,355115,792‐115,79222.96% 21.31% 21.58% 21.22%3921972542,695124,34546124,29922.90% 22.93% 21.86% 21.94% 21.62%3921973521,67974,78748874,29914.24% 18.66% 20.04% 19.95% 20.34% 20.24%3921974469,773131,277148131,12927.91% 20.72% 21.49% 21.86% 21.42% 21.53% 21.35%3921975376,91777,96141477,54720.57% 24.65% 20.68% 21.31% 21.66% 21.31% 21.43% 21.27%3921976537,83062,95388662,06711.54% 15.26% 19.56% 18.10% 19.17% 19.81% 19.79% 20.06% 20.01%3921977440,41072,23615072,08616.37% 13.71% 15.62% 18.79% 17.78% 18.74% 19.37% 19.41% 19.69% 19.67%3921978324,49672,22141271,80922.13% 18.81% 15.81% 16.88% 19.29% 18.30% 19.08% 19.61% 19.62% 19.86%3921979487,562130,2851,522128,76326.41% 24.70% 21.77% 18.70% 19.02% 20.61% 19.56% 20.05% 20.40% 20.32%3921980669,394160,3141,218159,09623.77% 24.88% 24.28% 22.47% 20.08% 20.14% 21.25% 20.29% 20.62% 20.86%3921981270,20467,4331,63665,79724.35% 23.94% 24.78% 24.29% 22.70% 20.50% 20.51% 21.48% 20.56% 20.83%3921982428,51387,83016587,66520.46% 21.96% 22.85% 23.78% 23.54% 22.33% 20.49% 20.50% 21.37% 20.55%3921983783,821235,08110,145224,93628.70% 25.79% 25.52% 24.98% 25.24% 24.90% 23.80% 22.13% 21.99% 22.57%3921984740,381169,6689,482160,18621.64% 25.27% 24.21% 24.23% 24.12% 24.45% 24.25% 23.41% 22.05% 21.94%3921985487,749115,1757,726107,44922.03% 21.79% 24.48% 23.78% 23.83% 23.82% 24.15% 23.99% 23.27% 22.05%39219861,235,434241,50622,563218,94317.72% 18.94% 19.75% 21.91% 21.74% 21.92% 22.19% 22.59% 22.56% 22.10%3921987605,759127,1381,054126,08420.81% 18.74% 19.43% 19.96% 21.74% 21.61% 21.77% 22.03% 22.40% 22.39%39219881,082,394230,200‐230,20021.27% 21.10% 19.68% 20.01% 20.30% 21.63% 21.54% 21.68% 21.90% 22.22%3921989879,289166,0401,218164,82218.74% 20.14% 20.30% 19.46% 19.75% 20.03% 21.20% 21.15% 21.28% 21.51%3921990477,94291,445‐91,44519.13% 18.88% 19.94% 20.11% 19.42% 19.69% 19.95% 21.04% 21.00% 21.13%39219911,331,314214,70012,484202,21615.19% 16.23% 17.05% 18.26% 18.62% 18.42% 18.71% 19.02% 20.02% 20.04%3921992802,383177,95523,589154,36619.24% 16.71% 17.16% 17.56% 18.43% 18.71% 18.52% 18.77% 19.05% 19.94%39219932,093,096429,49960,611368,88817.62% 18.07% 17.16% 17.36% 17.58% 18.18% 18.40% 18.30% 18.50% 18.74%39219941,247,106286,52939,805246,72419.78% 18.43% 18.59% 17.76% 17.87% 17.98% 18.43% 18.60% 18.49% 18.66%39219951,359,711308,28849,887258,40119.00% 19.38% 18.60% 18.69% 18.01% 18.08% 18.15% 18.52% 18.66% 18.55%39219961,770,617419,55439,866379,68821.44% 20.38% 20.21% 19.38% 19.36% 18.72% 18.74% 18.74% 18.99% 19.08%39219971,934,737163,9743,231160,7428.31% 14.59% 15.77% 16.56% 16.83%17.04% 16.80% 16.91% 17.04% 17.39%39219981,230,327‐‐‐0.00% 5.08% 10.95% 12.69% 13.86%14.68% 15.03% 15.05% 15.21% 15.44%3921999902,817‐‐‐0.00% 0.00% 3.95% 9.26% 11.10%12.38% 13.42% 13.83% 13.98% 14.16%3922000940,676‐‐‐0.00% 0.00% 0.00% 3.21% 7.97% 9.81% 11.14% 12.32% 12.77% 13.01%39220012,046,566323,0002,521320,47915.66% 10.73% 8.24% 6.26% 6.82% 9.75% 10.99% 11.95% 12.83% 13.19%39220022,668,480456,832246,091210,7417.90% 11.27% 9.39% 8.10% 6.82% 7.12% 9.32% 10.35% 11.18% 12.01%39220036,338,025374,258107,545266,7124.21% 5.30% 7.22% 6.65% 6.19% 5.65% 5.97% 7.51% 8.32% 9.02%39220046,187,416294,141282,62311,5170.19% 2.22% 3.22% 4.70% 4.45% 4.24% 3.98% 4.36% 5.62% 6.34%39220051,757,66081,354‐81,3544.63% 1.17% 2.52% 3.36% 4.69% 4.47% 4.27% 4.04% 4.38% 5.55%3922006165,00816,083‐16,0839.75% 5.07% 1.34% 2.60% 3.43% 4.73% 4.51% 4.32% 4.08% 4.42%3922007‐1,095,847(7,028)1,102,875NA 678.12% 62.43% 14.94% 10.23% 9.87% 10.49% 10.00% 9.57% 9.04%3922008‐‐‐‐NANA 678.12% 62.43% 14.94% 10.23% 9.87% 10.49% 10.00% 9.57%3922009379,394‐10,491(10,491)‐2.77%‐2.77% 287.93% 203.61% 51.69% 14.15% 9.90% 9.60% 10.23% 9.76%3922010‐‐‐‐NA‐2.77%‐2.77% 287.93% 203.61% 51.69%14.15% 9.90% 9.60% 10.23%3922011‐‐‐‐NANA‐2.77%‐2.77% 287.93% 203.61% 51.69% 14.15% 9.90% 9.60%3922012‐‐‐‐NANANA‐2.77%‐2.77% 287.93% 203.61%51.69% 14.15% 9.90%Appendix E-2Page 24 of 29Transactional2- yr3- yr4- yr5- yr6- yr7- yr8- yr9- yr 10- yrTransaction HistoryRemovalNetNet Net Net Net Net Net Net Net Net NetAcctYearRetirements SalvageCostSalvageSalv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. %Southwestern Public Service Company - TexasRetirement and Salvage Analysis3931977934‐‐‐0.00%39319785519‐91.63% 0.61%39319791,02411‐0.00% 0.57% 0.36%3931980‐‐‐NA 0.00% 0.57% 0.36%39319811,664‐8(8)‐0.48%‐0.48%‐0.30% 0.03% 0.02%3931982141‐‐‐0.00%‐0.44%‐0.44%‐0.28% 0.03% 0.02%3931983‐‐‐NA 0.00%‐0.44%‐0.44%‐0.28% 0.03% 0.02%39319842,01410‐100.50% 0.50% 0.46% 0.05% 0.05% 0.04% 0.20% 0.17%39319851,868‐‐‐0.00% 0.26% 0.26% 0.25% 0.04% 0.04% 0.03% 0.15% 0.13%39319861,41445‐453.18% 1.37% 1.04% 1.04% 1.01% 0.66% 0.66% 0.58% 0.65% 0.58%39319876,484‐‐‐0.00% 0.57% 0.46% 0.47% 0.47% 0.46% 0.35% 0.35% 0.32% 0.37%3931988486486‐486100.00% 6.97% 6.33% 5.18% 4.41% 4.41% 4.36% 3.79% 3.79% 3.53%39319891,156‐‐‐0.00% 29.60% 5.98% 5.57% 4.65% 4.03% 4.03% 3.99% 3.50% 3.50%39319903,001‐7(7)‐0.23%‐0.17% 10.32% 4.30% 4.18% 3.64% 3.25% 3.25% 3.22% 2.89%39319918,2732,715‐2,71532.82% 24.02% 21.79% 24.73% 16.46% 15.56% 14.28% 13.16% 13.16% 13.08%39319921,137‐‐‐0.00% 28.85% 21.82% 19.96% 22.73%15.55% 14.76% 13.60% 12.58% 12.58%39319932,017‐‐‐0.00% 0.00% 23.76% 18.77% 17.38%19.88% 14.16% 13.51% 12.54% 11.67%39319942,547‐‐‐0.00% 0.00% 0.00% 19.43% 15.95%14.94% 17.16% 12.72% 12.22% 11.41%39319953,9731,0982,749(1,650)‐41.54%‐25.31%‐19.33%‐17.06% 5.93% 5.05% 4.78% 6.83% 5.31% 5.21%39319962,548‐‐‐0.00%‐25.31%‐18.20%‐14.89%‐13.50% 5.19% 4.50% 4.29% 6.14% 4.88%3931997577‐‐‐0.00% 0.00%‐23.25%‐17.11%‐14.15%‐12.89% 5.05% 4.39% 4.19% 6.00%3931998429‐‐‐0.00% 0.00% 0.00%‐21.92%‐16.38%‐13.65%‐12.48% 4.95% 4.32% 4.12%39319993,602‐‐‐0.00% 0.00% 0.00% 0.00%‐14.83%‐12.07%‐10.52%‐9.81% 4.24% 3.76%39320002,181‐‐‐0.00% 0.00% 0.00% 0.00% 0.00%‐12.40%‐10.41%‐9.23%‐8.68% 3.90%3932001462‐‐‐0.00% 0.00% 0.00% 0.00% 0.00% 0.00%‐11.98%‐10.11%‐9.00%‐8.47%3932002765‐‐‐0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%‐11.35%‐9.66%‐8.64%39320031,804‐‐‐0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%‐10.10%‐8.74%3932004675‐‐‐0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%‐9.70%3932005‐‐‐‐NA 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%3932006‐‐‐‐NANA 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%3932007‐‐‐‐NANANA 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%3932008‐550‐550NA NA NA NA 81.52% 22.19%16.96% 14.84% 9.34% 5.80%393200912,898‐‐‐0.00% 4.26% 4.26% 4.26% 4.26% 4.05% 3.58% 3.41% 3.31% 2.93%39320101,953‐‐‐0.00% 0.00% 3.70% 3.70% 3.70% 3.70% 3.54% 3.17% 3.04% 2.96%3932011‐‐‐‐NA 0.00% 0.00% 3.70% 3.70% 3.70% 3.70% 3.54% 3.17% 3.04%3932012‐‐‐‐NANA 0.00% 0.00% 3.70% 3.70% 3.70% 3.70% 3.54% 3.17%Appendix E-2Page 25 of 29Transactional2- yr3- yr4- yr5- yr6- yr7- yr8- yr9- yr 10- yrTransaction HistoryRemovalNetNet Net Net Net Net Net Net Net Net NetAcctYearRetirements SalvageCostSalvageSalv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. %Southwestern Public Service Company - TexasRetirement and Salvage Analysis394197711,046851840.76%394197810,609308‐3082.90% 1.81%394197926,762719‐7192.69% 2.75% 2.29%39419806,679219102093.13% 2.78% 2.81% 2.40%394198172,064183633(450)‐0.62%‐0.31% 0.45% 0.68% 0.68%39419824,106‐28(28)‐0.68%‐0.63%‐0.32% 0.41% 0.63% 0.64%39419837,888‐18(18)‐0.23%‐0.38%‐0.59%‐0.32% 0.37% 0.58% 0.59%39419848,0311,904‐1,90423.71% 11.85% 9.28% 1.53% 1.64% 1.86% 1.94% 1.85%39419859,521‐22(22)‐0.23% 10.72% 7.33% 6.21% 1.36% 1.47% 1.71% 1.80% 1.73%394198616,728257432141.28% 0.73% 6.11% 4.93% 4.43% 1.35% 1.45% 1.67% 1.75% 1.68%394198711,68439‐390.33% 0.89% 0.61% 4.64% 3.93% 3.60% 1.26% 1.35% 1.57% 1.65%394198812,082‐52(52)‐0.43%‐0.05% 0.50% 0.36% 3.59% 3.13% 2.91% 1.12% 1.21% 1.43%394198979,429‐‐‐0.00%‐0.06%‐0.01% 0.17% 0.14% 1.52% 1.42% 1.36% 0.72% 0.79%394199029,197‐350(350)‐1.20%‐0.32%‐0.33%‐0.27%‐0.10%‐0.11% 1.04% 0.98% 0.94% 0.49%394199133,773680296511.93% 0.48% 0.21% 0.16% 0.17% 0.27% 0.25% 1.19% 1.14% 1.10%394199227,861‐29(29)‐0.10% 1.01% 0.30% 0.16% 0.12% 0.13% 0.22% 0.20% 1.03% 0.99%394199380,986653‐6530.81% 0.57% 0.89% 0.54% 0.37% 0.33% 0.33% 0.39% 0.37% 0.97%394199453,5041,673‐1,6733.13% 1.73% 1.41% 1.50% 1.15% 0.85% 0.80% 0.79% 0.81% 0.78%394199512,659‐‐‐0.00% 2.53% 1.58% 1.31% 1.41% 1.09% 0.82% 0.77% 0.76% 0.78%394199654,292‐‐‐0.00% 0.00% 1.39% 1.15% 1.00% 1.12% 0.89% 0.70% 0.66% 0.65%3941997181,585‐‐‐0.00% 0.00% 0.00% 0.55% 0.61% 0.56% 0.66% 0.55% 0.47% 0.45%394199865,605‐‐‐0.00% 0.00% 0.00% 0.00% 0.46% 0.52% 0.48% 0.58% 0.48% 0.42%3941999163,867‐‐‐0.00% 0.00% 0.00% 0.00% 0.00% 0.31% 0.38% 0.36% 0.44% 0.37%394200015,872‐‐‐0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.31% 0.37% 0.35% 0.43%394200140,216‐‐‐0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.28% 0.35% 0.33%394200212,162‐‐‐0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.28% 0.34%394200312,9142,2002,750(550)‐4.26%‐2.19%‐0.84%‐0.68%‐0.22%‐0.18%‐0.11%‐0.10%‐0.10% 0.18%39420044,3324,870‐4,870112.41% 25.05% 14.69% 6.21% 5.05% 1.73% 1.37% 0.87% 0.78% 0.77%39420051,82310,758‐10,758590.08% 253.88% 79.07% 48.28% 21.10%17.27% 6.00% 4.76% 3.03% 2.73%394200616,268935‐9355.75% 64.64% 73.87% 45.32% 33.71% 18.26% 15.46% 5.99% 4.81% 3.11%3942007‐‐‐‐NA 5.75% 64.64% 73.87% 45.32% 33.71% 18.26% 15.46% 5.99% 4.81%3942008712‐‐‐0.00% 0.00% 5.51% 62.19% 71.59% 44.42% 33.21% 18.11% 15.35% 5.97%394200960,973‐‐‐0.00% 0.00% 0.00% 1.20% 14.66% 19.69% 16.50% 14.67% 10.72% 9.69%39420106,746‐‐‐0.00% 0.00% 0.00% 0.00% 1.10%13.51% 18.23% 15.43% 13.81% 10.26%3942011‐‐‐‐NA 0.00% 0.00% 0.00% 0.00% 1.10% 13.51% 18.23% 15.43% 13.81%39420121,43169620749034.22% 34.22% 5.99% 0.71% 0.70% 0.70% 1.65% 13.85% 18.48% 15.69%Appendix E-2Page 26 of 29Transactional2- yr3- yr4- yr5- yr6- yr7- yr8- yr9- yr 10- yrTransaction HistoryRemovalNetNet Net Net Net Net Net Net Net Net NetAcctYearRetirements SalvageCostSalvageSalv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. %Southwestern Public Service Company - TexasRetirement and Salvage Analysis395197717,049432410.24%39519782,39260‐602.51% 0.52%39519791,8692‐20.11% 1.46% 0.48%39519804,944110‐1102.22% 1.64% 1.87% 0.81%395198117,676‐66(66)‐0.37% 0.19% 0.19% 0.39% 0.33%39519824,597‐‐‐0.00%‐0.30% 0.16% 0.16% 0.34% 0.30%39519837,964‐‐‐0.00% 0.00%‐0.22% 0.13% 0.12% 0.27% 0.26%39519845,424‐22(22)‐0.41%‐0.16%‐0.12%‐0.25% 0.05% 0.06% 0.19% 0.20%39519858,099‐‐‐0.00%‐0.16%‐0.10%‐0.08%‐0.20% 0.05% 0.05% 0.16% 0.18%3951986169,3461,0001,799(799)‐0.47%‐0.45%‐0.45%‐0.43%‐0.42%‐0.42%‐0.36%‐0.35%‐0.32%‐0.28%39519872,118‐‐‐0.00%‐0.47%‐0.44%‐0.44%‐0.43%‐0.42%‐0.41%‐0.35%‐0.35%‐0.32%395198818,169‐48(48)‐0.26%‐0.24%‐0.45%‐0.43%‐0.43%‐0.41%‐0.40%‐0.40%‐0.35%‐0.34%39519896,359‐‐‐0.00%‐0.20%‐0.18%‐0.43%‐0.42%‐0.41%‐0.40%‐0.39%‐0.39%‐0.34%395199029,655520(15)‐0.05%‐0.04%‐0.12%‐0.11%‐0.38%‐0.37%‐0.37%‐0.36%‐0.35%‐0.35%395199142,671‐‐‐0.00%‐0.02%‐0.02%‐0.07%‐0.06%‐0.32%‐0.31%‐0.31%‐0.31%‐0.30%39519924,388‐‐‐0.00% 0.00%‐0.02%‐0.02%‐0.06%‐0.06%‐0.32%‐0.31%‐0.31%‐0.30%395199355,671‐‐‐0.00% 0.00% 0.00%‐0.01%‐0.01%‐0.04%‐0.04%‐0.26%‐0.26%‐0.26%395199422,859‐‐‐0.00% 0.00% 0.00% 0.00%‐0.01%‐0.01%‐0.04%‐0.03%‐0.25%‐0.24%395199548,355‐‐‐0.00% 0.00% 0.00% 0.00% 0.00%‐0.01%‐0.01%‐0.03%‐0.03%‐0.22%395199615,471‐‐‐0.00% 0.00% 0.00% 0.00% 0.00% 0.00%‐0.01%‐0.01%‐0.03%‐0.03%3951997352,862‐‐‐0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%‐0.01%395199818,578‐‐‐0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%395199978,666‐‐‐0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%39520002,605‐‐‐0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%395200128,785‐‐‐0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%395200210,475‐‐‐0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%3952003395,4674,7944,794‐0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%39520045,737‐‐‐0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00%395200534,485‐(70)700.20% 0.17% 0.02% 0.02% 0.01% 0.01% 0.01% 0.01% 0.01% 0.01%3952006123‐‐‐0.00% 0.20% 0.17% 0.02% 0.02% 0.01% 0.01% 0.01% 0.01% 0.01%39520072,344‐818(818)‐34.89%‐33.14%‐2.02%‐1.75%‐0.17%‐0.17%‐0.16%‐0.16%‐0.13%‐0.13%3952008782‐‐‐0.00%‐26.16%‐25.17%‐1.98%‐1.72%‐0.17%‐0.17%‐0.16%‐0.16%‐0.13%395200984,441‐‐‐0.00% 0.00%‐0.93%‐0.93%‐0.61%‐0.58%‐0.14%‐0.14%‐0.13%‐0.13%3952010‐‐‐‐NA 0.00% 0.00%‐0.93%‐0.93%‐0.61%‐0.58%‐0.14%‐0.14%‐0.13%3952011‐‐‐‐NANA 0.00% 0.00%‐0.93%‐0.93%‐0.61%‐0.58%‐0.14%‐0.14%3952012‐‐‐2,786NANANA 3.30% 3.27% 2.25% 2.24% 1.67% 1.59% 0.39%Appendix E-2Page 27 of 29Transactional2- yr3- yr4- yr5- yr6- yr7- yr8- yr9- yr 10- yrTransaction HistoryRemovalNetNet Net Net Net Net Net Net Net Net NetAcctYearRetirements SalvageCostSalvageSalv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. %Southwestern Public Service Company - TexasRetirement and Salvage Analysis396196816,032‐‐‐0.00%39619693,0042,470‐2,47082.22% 12.98%396197029,8228,150‐8,15027.33% 32.35% 21.74%396197110,2683,425‐3,42533.36% 28.87% 32.59% 23.75%396197228,5805,850‐5,85020.47% 23.88% 25.37% 27.76% 22.68%396197330,3278,560‐8,56028.23% 24.46% 25.78% 26.25% 27.90% 24.11%396197415,4341,200‐1,2007.78% 21.33% 21.00% 22.50% 23.76% 25.25% 22.22%396197527,32117,85027217,57864.34% 43.92% 37.41% 32.65% 32.71% 31.58% 32.63% 29.38%396197646,7805,4631155,34811.43% 30.94% 26.95% 27.27% 25.96% 26.44% 26.58% 27.45% 25.33%396197726,7058,1971688,02930.07% 18.20% 30.71% 27.66% 27.78% 26.59% 26.96% 27.01% 27.77% 25.87%396197832,3106,223‐6,22319.26% 24.15% 18.53% 27.93% 25.84% 26.24% 25.45% 25.82% 26.00% 26.67%3961979‐‐‐‐NA 19.26% 24.15% 18.53% 27.93% 25.84% 26.24% 25.45% 25.82% 26.00%39619802,554‐‐‐0.00% 0.00% 17.85% 23.15% 18.09%27.40% 25.40% 25.87% 25.14% 25.52%3961981737200‐20027.14% 6.08% 6.08% 18.04% 23.20%18.15% 27.40% 25.41% 25.88% 25.14%396198247,8205,0363354,7019.83% 10.09% 9.59% 9.59% 13.33%17.39% 15.62% 22.84% 21.68% 22.54%396198360,72012,2322912,20320.10% 15.57% 15.65% 15.29% 15.29% 16.18% 18.35% 16.87% 22.16% 21.31%39619847,2614,375‐4,37560.25% 24.39% 18.38% 18.43% 18.04% 18.04% 18.30% 20.06% 18.27% 23.26%396198577,12726,2493,17523,07429.92% 32.53% 27.33% 22.99% 23.01% 22.71% 22.71% 22.22% 23.04% 21.24%3961986230,98385,99526385,73237.12% 35.31% 35.89% 33.34% 30.69% 30.68% 30.50% 30.50% 29.71% 29.73%396198769,09914,905‐14,90521.57% 33.54% 32.80% 33.31% 31.51% 29.41% 29.41% 29.25% 29.25% 28.64%396198852,5888,856‐8,85616.84% 19.53% 31.05% 30.84% 31.33% 29.96% 28.20% 28.20% 28.07% 28.07%396198935,4968,801‐8,80124.79% 20.05% 20.72% 30.48% 30.38% 30.84% 29.62% 27.99% 27.99% 27.87%39619908,6921,129‐1,12912.99% 22.47% 19.41% 20.31% 30.09% 30.06% 30.52% 29.35% 27.77% 27.77%396199116,0522,014‐2,01412.55% 12.70% 19.83% 18.44% 19.63% 29.41% 29.49% 29.94% 28.87% 27.37%396199274,97919,3002,52116,77922.38% 20.64% 19.98% 21.24% 20.01% 20.43% 28.33% 28.55% 28.95% 28.10%3961993141,83446,7706,00740,76328.74% 26.54% 25.58% 25.12% 25.08% 23.77% 23.39% 28.42% 28.59% 28.91%396199466,67013,1502,14411,00616.51% 24.83% 24.18% 23.56% 23.26% 23.42% 22.54% 22.40% 27.28% 27.54%39619956111431,649(1,507)‐246.44% 14.12% 24.04% 23.60% 23.01% 22.73% 22.94% 22.13% 22.05% 27.04%3961996245,022115,7361,738113,99846.53% 45.80% 39.54% 36.17% 34.22% 33.58% 33.25% 32.74% 31.44% 30.48%396199787,189‐‐‐0.00% 34.31% 33.80% 30.91% 30.34%29.37% 28.95% 28.73% 28.52% 27.68%3961998261,667‐‐‐0.00% 0.00% 19.20% 18.92% 18.68%20.46% 20.62% 20.48% 20.40% 20.57%3961999158,989‐‐‐0.00% 0.00% 0.00% 15.14% 14.93%15.06% 17.08% 17.46% 17.38% 17.35%3962000178,813‐‐‐0.00% 0.00% 0.00% 0.00% 12.24%12.07% 12.36% 14.40% 14.89% 14.86%3962001281,712‐97(97)‐0.03%‐0.02%‐0.02%‐0.01%‐0.01% 9.39% 9.26% 9.64% 11.54% 12.08%3962002207,989‐‐‐0.00%‐0.02%‐0.01%‐0.01%‐0.01%‐0.01% 8.01% 7.90% 8.29% 10.07%3962003361,94261,5853,89357,69215.94% 10.12% 6.76% 5.59% 4.84% 3.97% 3.74% 9.62% 9.53% 9.79%3962004586,150‐(13,983)13,9832.39% 7.56% 6.20% 4.98% 4.43% 4.03% 3.51% 3.37% 7.83% 7.77%396200582,076‐‐‐0.00% 2.09% 6.96% 5.79% 4.71% 4.21% 3.85% 3.38% 3.24% 7.57%3962006‐‐‐‐NA 0.00% 2.09% 6.96% 5.79% 4.71% 4.21% 3.85% 3.38% 3.24%3962007‐‐‐‐NANA 0.00% 2.09% 6.96% 5.79% 4.71% 4.21% 3.85% 3.38%3962008182,799‐‐‐0.00% 0.00% 0.00% 0.00% 1.64% 5.91% 5.04% 4.20% 3.80% 3.51%396200995,278‐‐‐0.00% 0.00% 0.00% 0.00% 0.00% 1.48% 5.48% 4.73% 3.98% 3.62%3962010‐‐‐‐NA 0.00% 0.00% 0.00% 0.00% 0.00% 1.48% 5.48% 4.73% 3.98%3962011‐‐‐‐NANA 0.00% 0.00% 0.00% 0.00% 0.00% 1.48% 5.48% 4.73%3962012‐‐‐‐NANANA 0.00% 0.00% 0.00% 0.00% 0.00% 1.48% 5.48%Appendix E-2Page 28 of 29Transactional2- yr3- yr4- yr5- yr6- yr7- yr8- yr9- yr 10- yrTransaction HistoryRemovalNetNet Net Net Net Net Net Net Net Net NetAcctYearRetirements SalvageCostSalvageSalv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. %Southwestern Public Service Company - TexasRetirement and Salvage Analysis39719778,0635963382583.20%397197823,4353891,283(894)‐3.81%‐2.02%397197911,4553,0021732,82924.70% 5.55% 5.11%39719802,870‐314(314)‐10.94% 17.56% 4.29% 4.10%397198139,7544,048304,01810.11% 8.69% 12.08% 7.27% 6.89%397198214,2111,1511,232(81)‐0.57% 7.30% 6.37% 9.45% 6.06% 5.83%3971983132,9711,1133,929(2,816)‐2.12%‐1.97% 0.60% 0.43% 1.81% 1.22% 1.29%39719849,013341661(320)‐3.55%‐2.21%‐2.06% 0.41% 0.24% 1.58% 1.04% 1.11%3971985188,56112,8383,0899,7495.17% 4.77% 2.00% 1.89% 2.74% 2.64% 3.28% 2.88% 2.89%397198692,0303921042880.31% 3.58% 3.36% 1.63% 1.56% 2.27% 2.20% 2.72% 2.42% 2.43%39719877,7035,3276574,67060.63% 4.97% 5.10% 4.84% 2.69% 2.58% 3.20% 3.12% 3.61% 3.28%3971988410,2169,0326,5062,5260.62% 1.72% 1.47% 2.47% 2.39% 1.68% 1.64% 2.02% 1.97% 2.26%3971989128,31916,1516,4629,6897.55% 2.27% 3.09% 2.69% 3.26% 3.18% 2.46% 2.41% 2.71% 2.67%3971990124,05910,9097,7103,1992.58% 5.11% 2.33% 3.00% 2.67% 3.17% 3.10% 2.47% 2.43% 2.70%397199187,0671,6083,517(1,909)‐2.19% 0.61% 3.23% 1.80% 2.40% 2.17% 2.72% 2.66% 2.13% 2.09%3971992155,686‐1,637(1,637)‐1.05%‐1.46%‐0.09% 1.89% 1.31% 1.81% 1.67% 2.23% 2.18% 1.75%3971993563,1762,50615,674(13,168)‐2.34%‐2.06%‐2.07%‐1.45%‐0.36%‐0.09% 0.23% 0.23% 0.76% 0.74%397199431,137‐3,954(3,954)‐12.70%‐2.88%‐2.50%‐2.47%‐1.82%‐0.71%‐0.35%‐0.04%‐0.02% 0.53%397199591,979‐863(863)‐0.94%‐3.91%‐2.62%‐2.33%‐2.32%‐1.74%‐0.73%‐0.38%‐0.09%‐0.07%3971996148,2293,1111,9281,1830.80% 0.13%‐1.34%‐2.01%‐1.86%‐1.89%‐1.43%‐0.56%‐0.28%‐0.02%3971997169,2642763,839(3,564)‐2.11%‐0.75%‐0.79%‐1.63%‐2.03%‐1.90%‐1.92%‐1.51%‐0.74%‐0.45%3971998234,227‐‐‐0.00%‐0.88%‐0.43%‐0.50%‐1.07%‐1.65%‐1.58%‐1.61%‐1.29%‐0.64%3971999278,849‐‐‐0.00% 0.00%‐0.52%‐0.29%‐0.35%‐0.75%‐1.34%‐1.32%‐1.36%‐1.10%3972000265,980‐‐‐0.00% 0.00% 0.00%‐0.38%‐0.22%‐0.27%‐0.59%‐1.14%‐1.14%‐1.18%397200117,272‐44(44)‐0.25%‐0.02%‐0.01%‐0.01%‐0.37%‐0.22%‐0.27%‐0.59%‐1.13%‐1.13%39720023,061,0589,3335208,8130.29% 0.28% 0.26% 0.24% 0.23% 0.13% 0.15% 0.13% 0.04%‐0.24%3972003288,434269,543265,1644,3791.52% 0.39% 0.39% 0.36% 0.34% 0.32% 0.22% 0.24% 0.22% 0.13%397200426,145‐‐‐0.00% 1.39% 0.39% 0.39% 0.36% 0.33% 0.32% 0.22% 0.24% 0.22%39720052,096,638‐124(124)‐0.01%‐0.01% 0.18% 0.24% 0.24% 0.23% 0.22% 0.21% 0.15% 0.16%3972006881,972‐40,141(40,141)‐4.55%‐1.35%‐1.34%‐1.09%‐0.43%‐0.43%‐0.41%‐0.39%‐0.38%‐0.42%397200733,361‐110,530(110,530)‐331.32%‐16.46%‐5.01%‐4.96%‐4.40%‐2.15%‐2.15%‐2.06%‐1.98%‐1.92%397200815,415,705(740,714)(25)(740,689)‐4.80%‐5.51%‐5.46%‐4.84%‐4.83%‐4.73%‐4.03%‐4.03%‐3.98%‐3.93%39720092,411,501‐‐‐0.00%‐4.15%‐4.77%‐4.76%‐4.28%‐4.27%‐4.19%‐3.63%‐3.62%‐3.59%3972010‐‐‐‐NA 0.00%‐4.15%‐4.77%‐4.76%‐4.28%‐4.27%‐4.19%‐3.63%‐3.62%3972011‐‐‐‐NANA 0.00%‐4.15%‐4.77%‐4.76%‐4.28%‐4.27%‐4.19%‐3.63%3972012‐‐‐‐NANANA 0.00%‐4.15%‐4.77%‐4.76%‐4.28%‐4.27%‐4.19%Appendix E-2Page 29 of 29Transactional2- yr3- yr4- yr5- yr6- yr7- yr8- yr9- yr 10- yrTransaction HistoryRemovalNetNet Net Net Net Net Net Net Net Net NetAcctYearRetirements SalvageCostSalvageSalv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. % Salv. %Southwestern Public Service Company - TexasRetirement and Salvage Analysis39819774,71135923577.58%39819784,364460‐46010.54% 9.00%39819795,584412‐4127.38% 8.77% 8.38%39819801,171353322.73% 6.57% 8.13% 7.97%398198116,011206443(237)‐1.48%‐1.19% 0.91% 2.46% 3.22%39819822,271163‐1637.18%‐0.40%‐0.22% 1.48% 2.82% 3.48%39819831,708239‐23913.99% 10.10% 0.83% 0.93% 2.28% 3.44% 3.98%39819842,49751‐512.04% 6.90% 7.00% 0.96% 1.05% 2.26% 3.33% 3.85%398198511,389259412181.91% 1.94% 3.26% 3.76% 1.28% 1.33% 2.16% 2.97% 3.41%39819865,909‐‐‐0.00% 1.26% 1.36% 2.36% 2.82% 1.09% 1.14% 1.89% 2.63% 3.05%39819872,189418‐41819.10% 5.16% 3.26% 3.13% 3.91% 4.19% 2.03% 2.05% 2.66% 3.31%39819886,045150‐1502.48% 6.90% 4.02% 3.08% 2.99% 3.62% 3.87% 2.09% 2.10% 2.64%398198916,347167‐1671.02% 1.42% 2.99% 2.41% 2.28% 2.26% 2.70% 2.91% 1.82% 1.83%39819905,36426212614.87% 1.97% 2.08% 3.33% 2.78% 2.57% 2.54% 2.92% 3.10% 2.05%39819916,475155182(27)‐0.42% 1.98% 1.42% 1.61% 2.66% 2.29% 2.21% 2.20% 2.55% 2.72%398199214,834252142381.60% 0.99% 1.77% 1.49% 1.61% 2.35% 2.11% 2.08% 2.08% 2.36%39819936,868250‐2503.64% 2.25% 1.64% 2.15% 1.78% 1.86% 2.51% 2.28% 2.22% 2.22%398199415,8952,555‐2,55516.07% 12.32% 8.09% 6.84% 6.63% 5.24% 5.00% 5.42% 5.02% 4.63%398199532,8422,000‐2,0006.09% 9.35% 8.64% 7.16% 6.52% 6.41% 5.52% 5.34% 5.63% 5.33%398199669,5992,470‐2,4703.55% 4.36% 5.94% 5.81% 5.36% 5.11% 5.10% 4.70% 4.63% 4.81%398199757,740825‐8251.43% 2.59% 3.31% 4.46% 4.43% 4.22% 4.07% 4.09% 3.87% 3.83%398199830,144‐‐‐0.00% 0.94% 2.09% 2.78% 3.81% 3.80% 3.66% 3.55% 3.58% 3.41%398199941,762‐‐‐0.00% 0.00% 0.64% 1.65% 2.28% 3.17% 3.18% 3.09% 3.01% 3.04%39820002,009‐‐‐0.00% 0.00% 0.00% 0.63% 1.64% 2.26% 3.14% 3.15% 3.07% 2.99%398200151,221‐‐‐0.00% 0.00% 0.00% 0.00% 0.45% 1.31% 1.86% 2.61% 2.63% 2.58%39820027,682‐‐‐0.00% 0.00% 0.00% 0.00% 0.00% 0.43% 1.27% 1.81% 2.54% 2.57%398200395,27712,48212,571(89)‐0.09%‐0.09%‐0.06%‐0.06%‐0.04%‐0.04% 0.26% 0.90% 1.34% 1.92%398200419,625‐11,131(11,131)‐56.72%‐9.76%‐9.15%‐6.46%‐6.38%‐5.16%‐4.53%‐3.40%‐2.11%‐1.45%3982005900‐‐‐0.00%‐54.23%‐9.69%‐9.09%‐6.42%‐6.35%‐5.14%‐4.51%‐3.39%‐2.11%39820068,182‐‐‐0.00% 0.00%‐38.77%‐9.05%‐8.52%‐6.13%‐6.07%‐4.95%‐4.37%‐3.30%3982007508‐‐‐0.00% 0.00% 0.00%‐38.10%‐9.01%‐8.49%‐6.12%‐6.05%‐4.94%‐4.36%3982008218‐‐‐0.00% 0.00% 0.00% 0.00%‐37.82%‐9.00%‐8.47%‐6.11%‐6.04%‐4.93%398200927,646‐‐‐0.00% 0.00% 0.00% 0.00% 0.00%‐19.50%‐7.36%‐7.01%‐5.31%‐5.26%3982010‐‐NA 0.00% 0.00% 0.00% 0.00% 0.00%‐19.50%‐7.36%‐7.01%‐5.31%3982011‐‐‐‐NANA 0.00% 0.00% 0.00% 0.00% 0.00%‐19.50%‐7.36%‐7.01%3982012‐‐501(501)NA NA NA‐1.81%‐1.80%‐1.77%‐1.37%‐1.34%‐20.38%‐7.69%

# Workp ap ers of

Dane A. Watson

Att a ch CD for Watson

workpapers