Xcel Energy Inc.
Benjamin G.S. Fowke III
TWST: As the economy is starting to recover, what kind of increased demand do you see for energy in the markets that Xcel Energy serves?
Mr. Fowke: We are seeing some pickup in the industrial and large commercial and industrial, C&I, customers as the economy recovers. The pickup to date has been minor and has been more than offset by flat residential and smaller C&I sales. So residential and C&I have been flat. Now, we know that our demand-side management and conservation programs that we offer our customers had reduced 2011 sales by about eight-tenths of 1%, and looking forward we are optimistic that the oil and gas industries that we serve, primarily in Texas, will continue to grow and drive sales. We're even forecasting growth in places like Wisconsin, where mining operations for frack sand, copper and taconite are expected to contribute to our growth in the future.
Now, we can't be sure that what we're seeing in residential, those flat sales, what's going to happen with that in the future. Historically, residential pretty much tracked GDP growth. We really need to watch that trend as we go forward to see if there is starting to be a disconnect between the historical trend. And by the way, that's not exclusive to Xcel. I think if you listen to what's taken place in the earnings calls from our peer groups, we're all looking at some of the same issue.
TWST: On the most recent earnings call, you said Xcel Energy intends to reduce its O&M expenses. Would you give us some insight on how the company will accomplish that and what's the amount you expect to cut over what period?