**Exhibit99.01**

 

**SPSCautionary Factors**

 

The Private Securities Litigation Reform Actprovides a “safe harbor” for forward-looking statements to encourage suchdisclosures without the threat of litigation, providing those statements areidentified as forward-looking and are accompanied by meaningful, cautionarystatements identifying important factors that could cause the actual results todiffer materially from those projected in the statement. Forward-lookingstatements are made in written documents and oral presentations of SPS. Thesestatements are based on management’s beliefs as well as assumptions andinformation currently available to management. When used in SPS’ documents ororal presentations, 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:

 

•             Economicconditions, including their impact on capital expenditures and the ability ofSPS to obtain financing on favorable terms, inflation rates and monetaryfluctuations;

•             Businessconditions in the energy business;

•             Demandfor electricity in the nonregulated marketplace;

•             Trade,monetary, fiscal, taxation and environmental policies of governments, agenciesand similar organizations in geographic areas where SPS has a financialinterest;

•             Customerbusiness conditions, including demand for their products or services and supplyof labor and materials used in creating their products and services;

•             Financialor regulatory accounting principles or policies imposed by the FinancialAccounting Standards Board, the Securities and Exchange Commission, the FederalEnergy Regulatory Commission and similar entities with regulatory oversight;

•             Availabilityor cost of capital such as changes in: interest rates; market perceptions ofthe utility industry, SPS, Xcel Energy or any of its other subsidiaries; orsecurity ratings;

•             Factorsaffecting utility operations such as unusual weather conditions; catastrophicweather-related damage; unscheduled generation outages, maintenance or repairs;unanticipated changes to fossil fuel or natural gas supply costs oravailability due to higher demand, shortages, transportation problems or otherdevelopments; environmental incidents; or electric transmission or gas pipelineconstraints;

•             Employeeworkforce factors, including loss or retirement of key executives, collectivebargaining agreements with union employees, or work stoppages;

•             Increasedcompetition in the utility industry;

•             Stateand federal legislative and regulatory initiatives that affect cost andinvestment recovery, have an impact on rate structures and affect the speed anddegree to which competition enters the electric markets; industry restructuringinitiatives; transmission system operation and/or administration initiatives;recovery of investments made under traditional regulation; nature ofcompetitors entering the industry; retail wheeling; a new pricing structure;and former customers entering the generation market;

•             Rate-settingpolicies or procedures of regulatory entities, including environmentalexternalities, which are values established by regulators assigningenvironmental costs to each method of electricity generation when evaluatinggeneration resource options;

•             Socialattitudes regarding the utility and power industries;

•             Costand other effects of legal and administrative proceedings, settlements,investigations and claims;

•             Technologicaldevelopments that result in competitive disadvantages and create the potentialfor impairment of existing assets;

•             Significantslowdown in growth or decline in the U.S. economy, delay in growth or recoveryof the U.S. economy or increased cost for insurance premiums, security andother items;

•             Risksassociated with implementation of new technologies; and

•             Otherbusiness or investment considerations that may be disclosed from time to timein SPS’ SEC filings or in other publicly disseminated written documents.

 

SPS undertakes no obligation to publiclyupdate or revise any forward-looking statements, whether as a result of newinformation, future events or otherwise. The foregoing review of factors shouldnot be construed as exhaustive.

 

----