**Exhibit99.01**

 

**SPSCautionary Factors**

 

The Private Securities Litigation Reform Act providesa “safe harbor” for forward-looking statements to encourage such disclosureswithout the threat of litigation, providing those statements are identified asforward-looking and are accompanied by meaningful, cautionary statementsidentifying important factors that could cause the actual results to differmaterially from those projected in the statement. Forward-looking statementsare made in written documents and oral presentations of SPS. These statementsare based on management’s beliefs as well as assumptions and informationcurrently available to management. When used in SPS’ documents or oralpresentations, the words “anticipate,” “estimate,” “expect,” “projected,”objective,” “outlook,” “forecast,” “possible,” “potential” and similarexpressions are intended to identify forward-looking statements. In addition toany assumptions and other factors referred to specifically in connection withsuch forward-looking statements, factors that could cause SPS’ actual resultsto differ materially from those contemplated in any forward-looking statementsinclude, among others, the following:

 

•             Economic conditions, including theirimpact on capital expenditures and the ability of SPS to obtain financing onfavorable terms, inflation rates and monetary fluctuations;

•             Business conditions in the energybusiness;

•             Demand for electricity in the nonregulatedmarketplace;

•             Trade, monetary, fiscal, taxation andenvironmental policies of governments, agencies and similar organizations ingeographic areas where SPS has a financial interest;

•             Customer business conditions, includingdemand for their products or services and supply of labor and materials used increating their products and services;

•             Financial or regulatory accountingprinciples or policies imposed by the Financial Accounting Standards Board, theSecurities and Exchange Commission, the Federal Energy Regulatory Commissionand similar entities with regulatory oversight;

•             Availability or cost of capital such aschanges in: interest rates; market perceptions of the utility industry, SPS,Xcel Energy or any of its other subsidiaries; or security ratings;

•             Factors affecting utility operations suchas unusual weather conditions; catastrophic weather-related damage; unscheduledgeneration outages, maintenance or repairs; unanticipated changes to fossilfuel or natural gas supply costs or availability due to higher demand,shortages, transportation problems or other developments; environmentalincidents; or electric transmission or gas pipeline constraints;

•             Employee workforce factors, including lossor retirement of key executives, collective bargaining agreements with unionemployees, or work stoppages;

•             Increased competition in the utilityindustry;

•             State and federal legislative andregulatory initiatives that affect cost and investment recovery, have an impacton rate structures and affect the speed and degree to which competition entersthe electric markets; industry restructuring initiatives; transmission systemoperation and/or administration initiatives; recovery of investments made undertraditional regulation; nature of competitors entering the industry; retailwheeling; a new pricing structure; and former customers entering the generationmarket;

•             Rate-setting policies or procedures ofregulatory entities, including environmental externalities, which are valuesestablished by regulators assigning environmental costs to each method ofelectricity generation when evaluating generation resource options;

•             Social attitudes regarding the utility andpower industries;

•             Cost and other effects of legal andadministrative proceedings, settlements, investigations and claims;

•             Technological developments that result incompetitive disadvantages and create the potential for impairment of existingassets;

•             Significant slowdown in growth or declinein the U.S. economy, delay in growth or recovery of the U.S. economy orincreased cost for insurance premiums, security and other items;

•             Risks associated with implementation ofnew technologies; and

•             Other business orinvestment considerations that may be disclosed from time to time in SPS’ SECfilings, including “Risk Factors” in Item 1A of SPS’ Annual Report on Form 10-Kfor the year ended Dec. 31, 2005, or in other publicly disseminated writtendocuments.

 

SPS undertakes no obligation to publicly update orrevise any forward-looking statements, whether as a result of new information,future events or otherwise. The foregoing review of factors should not beconstrued as exhaustive.

 

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