**Exhibit 99.01**

 

## **PSCo’s CAUTIONARYFACTORS**

##  

The Private SecuritiesLitigation Reform Act provides a “safe harbor” for forward-looking statementsto encourage such disclosures without the threat of litigation, providing thosestatements are identified as forward-looking and are accompanied by meaningful,cautionary statements identifying important factors that could cause the actualresults to differ materially from those projected in the statement.Forward-looking statements are made in written documents and oral presentationsof PSCo.  These statements are based onmanagement’s beliefs as well as assumptions and information currently availableto management. When used in PSCo’s documents or oral presentations, the words “anticipate,”“estimate,” “expect,” “projected,” objective,” “outlook,” “forecast,” “possible,”“potential” and similar expressions are intended to identify forward-lookingstatements. In addition to any assumptions and other factors referred tospecifically in connection with such forward-looking statements, factors thatcould cause PSCo’s actual results to differ materially from those contemplatedin any forward-looking statements include, among others, the following:

 

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

 

·              Business conditions in theenergy business;

 

·              Trade, monetary, fiscal,taxation and environmental policies of governments, agencies and similar organizationsin geographic areas where PSCo has a financial interest;

 

·              Customer businessconditions, including demand for their products or services and supply of laborand materials used in creating their products and services;

 

·              Financial or regulatory accountingprinciples or policies imposed by the Financial Accounting Standards Board, theSEC, the Federal Energy Regulatory Commission and similar entities withregulatory oversight;

 

·              Availability or cost ofcapital such as changes in: interest rates; market perceptions of the utilityindustry, PSCo; or security ratings;

 

·              Factors affecting utilityand nonutility 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 natural gaspipeline constraints;

 

·              Employee workforce factors,including loss or retirement of key executives, collective bargainingagreements with union employees, or work stoppages;

 

·              Increased competition in theutility industry or additional competition in the markets served by PSCo;

 

·              State, federal and foreignlegislative and regulatory initiatives that affect cost and investmentrecovery, have an impact on rate structures and affect the speed and degree towhich competition enters the electric and natural gas markets; industryrestructuring initiatives; transmission system operation and/or administrationinitiatives; recovery of investments made under traditional regulation; natureof competitors entering the industry; retail wheeling; a new pricing structure;and former customers entering the generation market;

 

·              Rate-setting policies orprocedures of regulatory entities, including environmental externalities, whichare values established by regulators assigning environmental costs to eachmethod of electricity generation when evaluating generation resource options;

 

·              Social attitudes regardingthe utility and power industries;

 

·              Risks associated with theCalifornia power market;

 

·              Cost and other effects oflegal and administrative proceedings, settlements, investigations and claims;

 

·              Technological developmentsthat result in competitive disadvantages and create the potential forimpairment of existing assets;

 

·              Significant slowdown ingrowth or decline in the U.S. economy, delay in growth or recovery of the U.S.economy or increased cost for insurance premiums, security and other items as aconsequence of the Sept. 11, 2001 terrorist attacks;

 

·              Risks associated withimplementation of new technologies; and

 

·              Other business or investmentconsiderations that may be disclosed from time to time in PSCo’s SEC filings orin other publicly disseminated written documents.

 

PSCo undertakes noobligation to publicly update or revise any forward-looking statements, whetheras a result of new information, future events or otherwise. The foregoingreview of factors should not be construed as exhaustive.

 

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