Xcel Energy plans to increase wind power in area five-fold by end of 2005

Two plants to be added tax credit-supported wind energy now 'excellent buy for customers'

AMARILLO, TEXAS - October 22, 2004 - Xcel Energy plans to increase the amount of wind-generated electric power it provides customers in Texas, New Mexico, Oklahoma and Kansas more than five times over by the end of 2005, adding 360 megawatts of wind energy to the 85 MW it supplies in the region today.

The planned total of 445 MW of wind energy would serve the average annual needs of about 150,000 homes. It would equal more than 10 percent of the company's approximately 4,350 MW of installed coal- and natural gas-fueled power plant capability in the region.

"We're pleased to announce this ambitious wind-power goal, which substantiates our commitment to cost-efficient forms of renewable energy," said Gary L. Gibson, Xcel Energy state vice president and president of Xcel Energy's Amarillo-based operating company, Southwestern Public Service Company.

"We also are announcing that to reach our goal, we have selected to purchase power by 2006 from two proposed large, new wind power developments, a 160-megawatt wind ranch near Wildorado and a 120-MW wind farm near Elida, New Mexico," Gibson said.

The two new facilities, to be developed by Cielo Wind Power of Austin and Padoma Wind Power LLC of La Jolla, Calif., are proposed to be on line by the end of 2005. The two would provide enough power for the average annual needs of more than 97,000 homes. Cielo also already is developing a new 80-MW, Tucumcari, N.M., wind facility for sales to Xcel Energy beginning in late 2004 and early 2005.

"Power from wind now is an excellent buy for our customers," Gibson said. "The wind facilities from which we are buying and will buy power, including both of these new facilities, are supported by federal electricity-production tax credits. The proposed Elida plant also will benefit from New Mexico state tax credits. The price we are charged for tax credit-supported wind energy is lower than our costs of producing electricity at natural gas-fueled power plants. So, when the wind plants produce power, we can decrease production at our gas-fueled plants, thereby decreasing our customers' monthly bills."

Cielo proposes the Wildorado-area facility. It would be situated about 25 miles west of Amarillo, north of I-40 on an uplands area in Oldham and Potter counties. Padoma proposes the "San Juan Mesa Wind Project" near the county line between Chaves and Roosevelt counties about 65 miles northeast of Roswell, N.M. Xcel Energy and the developers have not completed negotiations of expected 20-year contracts, and transmission facility improvements might be needed to accommodate the projects, Gibson cautioned.

Cielo Wind Power is the largest developer of wind power in the southwestern United States, said Walter Hornaday, Cielo president. Cielo has developed two projects and is developing a third for Xcel Energy: The 660-kilowatt "Llano Estacado Wind Ranch," the first commercial-scale wind facility in New Mexico, which came on line near Clovis, N.M., on June 22, 1999 (now expanded, it can produce 1.98 megawatts); an 80-MW wind ranch near White Deer, on line in 2001; and the 80-MW wind ranch near Tucumcari. "We are pleased to continue to work with Xcel Energy and to continue to develop the great wind-power potential of the Southwest," Hornaday said.

Jan C. Paulin, Padoma Wind Power president and chief executive officer, said, "We're excited to have been selected to build this significant new project producing clean, renewable power in the state of New Mexico. Padoma is committed to make this project a model for future wind farm development."

For information about Cielo and Padoma, visit www.cielowind.com and www.padoma.com. Xcel Energy also buys wind power from Aeolus Wind LLC's experimental three-MW unit in Hansford County.

Xcel Energy of Minneapolis is a major U.S. electricity and natural gas company with regulated operations in 11 states. It is the second largest provider of retail wind energy in the United States (see www.xcelenergy.com), and provides energy-related services to 3.3 million electricity and 1.8 million natural gas customers through operating companies, including Southwestern Public Service Co. SPS provides electricity to about one million people in a 52,000-square-mile area comprised of southeastern New Mexico, the panhandles of Texas and Oklahoma and southwestern Kansas.