埃克西爾能源 (XEL) 2008 Q3 法說會逐字稿

Welcome to the Welcome to the Xcel Energy third quarter 2008 earnings conference call. Energy third quarter 2008 earnings conference call. (OPERATOR INSTRUCTIONS)

At this time, I would like to turn the conference over to Mr. Paul Johnson, Managing Director, Investor Relations. Please go ahead, sir.

Thank you and welcome to Xcel Energy's third quarter 2008 earnings release conference call. I'm Paul Johnson. With me today is Ben Fowke, Vice President and Chief Financial Officer of Xcel Energy, and several others who can help answer your questions. Today, we plan to cover our third quarter results, provide a business update, and discuss our 2008 guidance. Please note that there are slides that accompany the conference call which are available on our web page. Let me remind you that some of the comments may contain forward-looking information, significant factors that could cause results to differ from those anticipated are described in our earnings release and our filings with the SEC. Today's discussion will focus on ongoing results which we believe represent the fundamental earnings power of Xcel Energy. Please refer to our earnings release for a reconciliation of non-GAAP earnings.

Before I turn the call over to Ben, I will cover our overall financial results, and how we calculate ongoing earnings. Third quarter 2008 GAAP earnings were $223 million or $0.51 per share compared to $255 million or $0.59 per share in 2007. In 2007, we reached a settlement resolving our dispute with the IRS regarding our COLI program. Our 2008 third quarter earnings do not include any material impacts from the discontinued COLI program. However, our 2007 third quarter GAAP earnings include a gain of $0.01 per share associated with the resolution of this dispute. This morning's discussion will focus on ongoing earnings which exclude the impact of COLI on our results. Ongoing earnings for the third quarter 2008 were $0.51 per share versus $0.58 per share last year. With that, I'll turn the call over to Ben.

Thanks, Paul, and welcome everyone. As Paul just mentioned, our ongoing earnings were $0.51 per share for the third quarter of 2008 compared to $0.58 per share a year ago. As we noted in the prospectus supplement for our equity issuance in early September, we expected earnings would decline for the quarter. There were a couple of items that benefited 2007 earnings that were not expected to recur in the third quarter of 2008. Most notably, third quarter 2007 earnings were increased by about $0.08 per share from a depreciation adjustment and warmer than normal temperatures. However, third quarter 2008 results were also negatively impacted by an erosion in residential sale, particularly at NSP-Minnesota. As a result, we are becoming more concerned about the overall economy and the potential impact of the financial crisis on our customers' behavior. I will discuss this impact in greater detail in a few moments, but let me start with the quarterly results.

Third quarter 2008 ongoing earnings decreased by $0.07 compared to last year largely due to lower electric margin, largely driven by an unfavorable weather comparison, and lower than expected sales growth which decreased earnings by $0.04 per share and higher depreciation expense which decreased earnings by $0.03 per share. Starting with the top of the income statement, electric margin decreased by about $28 million for the quarter due to a combination of factors, although the most significant driver was an unfavorable weather comparison. On a positive side, an electric rate increase in Wisconsin, an interim rate increase in north Dakota, and the MERP rider combined to increase electric margin by $20 million this quarter. However, these increases were offset by a combination of items. An unfavorable weather comparison between the quarters, reduced electric margin by $32 million or roughly $0.05 per share. We also experienced slower sales growth in the quarter. On a weather adjusted basis, retail sales grew by only 1%. In addition, weather adjusted residential sales actually declined 2.2% for the quarter, and within the C & I customer class we saw decline in small C & I sales offset by growths in our larger C & I class.

On this, it's a trend we first discussed last quarter, and it appears to have continued and accelerated this quarter. As many of you know, residential sales provide higher margin than the C & I class. Combination of lower sales growth and a change in sales mix resulted in no growth in electric margin for the quarter. On a year-to-date basis, our total weather adjusted retail sales grew 1.8%. However, our residential sales growth was flat. This trend was not contemplated in our annual guidance. Generally, electric sales growth of 2% across all customer classes will provide incremental earnings of about $0.06 per share on a year-to-date basis. However, the year-to-date combination of weather adjusted sales growth and customer mix have only increased earnings by about $0.02 per share. This represents an opportunity cost of $0.04 per share and has created an unexpected earnings drag. We have updated our sales forecast and unfortunately we expect this trend to continue into next year.

Finally, electric margin declined by $17 million due to the deferral of revenue associated with nuclear outage expenses. In the third quarter, the Minnesota PUC approved our nuclear outage amortization request with certain modifications. The impact of the ruling was for about half of what we anticipated in our original guidance. The ruling reduced O&M expenses but was partially offset by revenue deferrals. For more information on the other items that had an impact on electric margin for the quarter please refer to our table in our earnings release.

Moving on to O&M expenses, third quarter O&M was essentially flat for the quarter. Increases in labor costs, consulting, and generation costs were offset by lower benefit costs, a change in our accounting for nuclear outage costs and various management initiatives. In light of the lower sales growth, we have taken and will continue to take management actions to reduce O&M expenses. This includes lowering the accrual for incentive compensation. While we are taking steps to reduce costs we will not sacrifice customer service or reliability. As a result of these actions, we now project O&M expenses will be relatively flat for the full year.

Next, third quarter depreciation and amortization expense increased $23 million or about 12%. As you recall, during the third quarter last year, the Minnesota Commission approved NSP-Minnesota's remaining life depreciation filing for the Monticello nuclear plant, effective January 2007. This ruling reduced our third quarter 2007 depreciation expense by $31 million. This increase was partially offset by an updated depreciation study approved this year. That explains the significant quarterly deviation. Next I want to touch on a couple of regulatory items.

We have several pending rate cases that we have included and updated in our earnings release. We are also planning on filing cases in Colorado and Minnesota. In Colorado, we are planning to file an electric rate case based on a forward test year. The timing of this case is subject to several factors. In particular, we are looking at several different options for test years related to the cost recovery of Comanche 3, which is expected to come on-line in the second half 2009. We are also looking at filing an electric rate case in Minnesota. In Minnesota, interim rates would go into effect 60 days after the rate filing. I know you have lots of questions about the Minnesota and Colorado rate cases. However, there's still a lot of moving pieces, and I'm not in a position to provide too much color, since we're still in the process of determining the timing, size, and scope of the cases. We anticipate having more clarity on the details in the coming weeks, and we will provide with you an update at either the EEI meeting, or at our analyst meeting in December.

I would like to spend a few minutes discussing how we have been successfully managing through the credit and liquidity crisis. We have always viewed conservative financial management as a strength. The last several years, I have discussed the importance of strong credit ratings, of solid balance sheet and good liquidity. While this philosophy hasn't always been in vogue, times have certainly changed. Over the last year, we have been proactive, taking steps to strengthen our balance sheet and improve liquidity. For example, several years ago we entered into a multi-company 5 year credit facility, and then subsequently extended to 10 years. As a result, our credit facilities don't mature until the end of 2011. Our combined credit facilities provide just under $2.2 billion of liquidity, and that is after adjusting for the Lehman bankruptcy. In 2007, we completed a debt exchange for a $600 million bond at the holding Company. This allowed us to reduce the amount maturing in 2010, and to extend a portion of the debt until 2017. Earlier this year we issued a retail hybrid security at the holding Company prior to the closing of the hybrid market. We prefunded debt maturities and paid down short-term debt at NSP Minnesota, PSCo, and NSP Wisconsin by issuing first mortgage bonds earlier in the year when rates were attractive. Finally, we further strengthened our balance sheet by issuing equity in September before the markets collapsed. All of these actions improved our liquidity and reduced risk. At the end of this week, we have a total liquidity of about $1.9 billion. In addition, we have expanded our earnings release to provide additional information on our liquidity position.

While we have taken proactive actions and have strong liquidity, the economy is having an impact on our results and probably other utilities. As I mentioned earlier, we experienced a slowdown in electric sales growth during the quarter, particularly in the residential customer class. We currently are projecting that this trend will continue into the fourth quarter and 2009. In addition to the impact on sales growth, we are closely monitoring other economic impact including bad debt expense and interest rates for the potential impact on 2009. After we close the books on our third quarter results, we spent a great deal of effort on our forecast to reflect the changing economic conditions and trends. As a result, we now expect to be at the low end of 2008 earnings guidance range of $1.45 to $1.50 per share. In past years, we have released our earnings guidance for the next year in conjunction with our third quarter earnings release. However this year, we plan to issue our 2009 earnings guidance at either EEI or our analyst meeting in December. This will allow us additional time to update our forecast for the potential rate cases and the latest economic trends.

While we're not issuing guidance I would like to provide some qualitative comments. We recognize that we are in uncharted waters, and expect 2009 to be a challenging year. We expect that the economic situation will continue to be bearish, and that credit market will remain tight. So how will this affect Xcel Energy? While we don't view this as a long-term trend, we are currently projecting weather adjusted sales growth to be flat in 2009. We expect O&M costs will continue to rise. While there's been some recent moderation, commodity costs are still higher than historic levels. Our rate-based growth plan increases the scope of our utility operations and our O&M expenses. Finally, we expect the bad debt expense will continue to be an area of concern. Our rate based growth strategy will also increase depreciation expense. Finally, credit markets will remain tight and interest costs will be higher than historic levels. While some of these cost increases will be covered by riders and forward-looking rate cases with interim rates, we aren't filing cases in all jurisdictions, and there will be some regulatory lag. As a result, even with rate filings, we expect that our 2009 earnings will be only modestly higher than 2008 results. While we're still confident in our long-term strategy and growth objectives, we do anticipate next year's earnings growth will be below our historic rate as the nation adjusts to the new economic realities.

Next, let me spend a few minutes talking about our capital expenditures. As many of you know, we have a wide range of attractive investment opportunities, as we developed our plans, our projected capital forecast was above what we had previously shared with you. However, in the light of recent market volatility and the tightening of credit markets, we have decided to revisit these preliminary plans. We continue to evaluate each of our projects to determine an optimal level of spend that enables our Company to achieve our renewable growth goals, but also allows for flexibility given the current market conditions. We anticipate that once this evaluation is complete, our projected capital expenditure forecast will be consistent with what we've shared with you previously. In the coming weeks, we plan to finalize the details associated with our earnings guidance, capital expenditure forecast, and our rate plans. We plan to discuss this with you in detail at either EEI, or at our analyst day in New York on December 3rd.

Before turning the call over to you for questions, I would like to comment on just a few more items. In closing, the market uncertainty we've all witnessed is precedented. We believe we have successfully navigated this volatility and lowered our overall risk profile. To date, we've raised over $2 billion with a combination of debt, hybrid, and equity issuances. Given these successful financings, we are well-positioned to execute our growth plan into 2009. Strategy is working, pursuing clean energy allows Xcel Energy to meet increasing demand and reduce carbon with smaller, less time-sensitive projects. This provides with us additional flexibility, adding smaller renewable assets to the fleet will allow the Company to push out the time line for new base load investment for many years. Considering the projected costs for new base load plants, and where credit markets are today, we are fortunate to have this flexibility.

So in summary, while the economy poses challenges for us, I believe we are uniquely positioned and prepared to meet our strategic plans, environmental goals, and long-term objectives. So with that, Operator, we'll take questions.

Thank you, sir. (OPERATOR INSTRUCTIONS) And our first question is from the line of Danielle Seitz with Seitz Research. Please go ahead.

Hey Danielle, how are you?

Good, I just was wondering if you, since you have done so much advanced financing, do you still need, plan on issuing equity next year, or is it still not really firm yet?

No, Danielle, I think the steps we took in September with equity addressed our equity needs for the foreseeable future.

Great. And also you mentioned bad debt expenses. Do you have any comparison or any data that you can share at this time?

Bad debt for the quarter was just slightly above third quarter 2007, and we are forecasting that bad debt will come in about at the same level in 2008 as it did in 2007, and about what it did in 2006. That is, though, an expense higher than what we originally anticipated for the year, Danielle. I think I mentioned in prior calls we have really improved a lot of processes on our bad debt collection, and we had hoped that we could bring bad debt expense down, but given the economic conditions we're in, that's not likely now. And I do believe that we need to really monitor this trend in the coming quarter and certainly into 2009.

Thanks.

Thank you. Our next question comes from the line of Ashar Kahn with SAC Capital. Please go ahead.

Good morning. Ben, if I'm right you need $0.36 or a $0.06 improvement in the fourth quarter to achieve the lower end of the guidance. Could you tell us what are the positive factors versus last year which will allow to you reach the low end of the guidance?

A lot of it will come in O&M, Ashar. Last year I believe O&M probably was running at a trend line higher than what you saw the full year. This year we expect it will be the opposite. So that will do a lot for us. The $0.02 benefit, we only got half of what we were looking for from the nuclear fueling outage. You'll see that impact in the O&M number, so by and large, it will be in O&M.

Okay. And then, Ben, you referred to, in your release, that you might need higher equity contributions in the pension and decommissioning funds. Could you talk about that, how much higher contributions would be required, and I guess you have the cash flows for those?

Yeah, well, let me just put it in perspective. We entered the year with a very well funded pension plan, I think one of the better funded plans in the industry and in the nation. So we start from a good place. But, you know, everybody knows what's happened in the market year to date. So as a result, the funded status has fallen. And we talked about where the asset levels are in the earnings release. Keep in mind, Ashar, that some of that will be offset by a higher discount rate. The bottom line is, we've been funding about $35 million a year in our pension plan. We don't have the exact numbers now. We'll have to obviously analyze that as the year progresses. But I suspect that funding levels will increase from that $35 million a year level.

OKay, and if I can just end up with, Ben, so as I know next year you are saying zero growth, you are saying bad debt O&M, or somewhat offset by the increase from the interim rate hike, so as we go out beyond that, I guess, and you kind of went away from your long-term growth rate. How should we look beyond that? Is that Colorado rate case and all, and the growth coming back gets you back towards growth later on, or should we just take a lower stab at the earnings growth rate, going from 2009 onward?

Are you talking about our long-term earnings growth objective of 5% to 7%? Ashar, the way I see it is there's no reason to think that that long-term growth rate is not still valid. That said, I think it's very difficult to have that have sort of long-term growth rate in this economic, with this economic condition. So, assuming we start to see the economy improve, then we're right back on track in what we can see in our long-term growth rate.

Okay. And if I can end up with, was there a reduction in retail sales consistent among all the companies, like Colorado, Wisconsin, Minnesota, or was it more hurt in one area versus the other?

It definitely, we saw the impact much more here in NSP-Minnesota. A little less so in Colorado, and sales were stronger at SPS. So it depends on the jurisdiction. And within the retail sales, as I mentioned on the call, the real surprising thing for us was the decline in residential sales, which has a higher margin associated with it.

Okay.

Ashar, I think that's consistent when you look at the macroeconomic trends for each one of those states that I referred to.

Thank you, sir.

Thank you. Our next question comes from the line of Angie Storozynski with MacQuarie Capital. Please go ahead.

I'm going to ask the same question again about the elasticity of residential demand. Do you think it's a trend that is sustainable? Should we consider it conservation efforts that we should see going forward, or is it just an adjustment of the mass trends to basically prices of electricity and with natural gas and maybe coal prices coming down, we should expect that this is going to disappear?

Well, I think that's a great question. I don't know if I have a definitive answer for you. I think if you look at what's happened in the last month, last couple months, and the acceleration of residential sales growth, or the lack of acceleration, I should say, then you have to attribute that, I think to probably the more macro economic conditions. But, you know, we had seen some, I think some general conservation efforts in the second quarter. We started spotting that trend, which I think was probably more consistent with higher commodity prices and more environmental awareness and conservation efforts. And, in fact, we had been working very hard as part of state policy to implement conservation. So we need to monitor that trend. I think you are going to see sales remain relatively flat in 2009. My suspicion is that when the economy starts to improve you will start to see the growth rate inch back up to more like its historic levels.

Ok, thank you.

Thank you. Our next question is from the line of Paul Patterson with Glenrock Associates. Please go ahead.

Good morning.

Good morning.

Just to serve a brief question on the rate case. And the staff testimony that came out in Texas. There was a depreciation reduction expense that they had expected. Do you know what it was as, how much that related to the difference between what you guys were asking for and what the Company was putting forward?

Yeah, Paul, let me turn that over to Scott Wilensky, who runs our Regulatory Affairs.

Thank you. The staff reduction was approximately equal to the same rate change that we had requested in the case. We had requested a rate change that increased revenue requirement by about $11 million, and their reduction in essence reversed that.

Okay, and then in terms of, when you talk about modest growth over 2009 versus 2008, we're talking, what, just a couple percent? Is that the thing we should be thinking the about?

That's what we need to work on in the next couple weeks, as we look at how we're filing these rate cases, and we continue to assess economic trends. So I'll leave it at that qualitative note at this point, Paul.

Okay. And then the C & I seemed to do okay. Do you expect that to change with the economic conditions, or just how should we think about that?

You know, we don't, with the exception of SPS, we don't have a huge industrial base. It's more the C than the I. But what we, and so generally it's behaved pretty normally, although as I told you and mentioned in the call, more sales on the larger C & I class, a little bit less on the smaller C & I class, and again, that erodes margin profitability as well as larger, C & I class. You tend to make your return on demand revenues and not so much the energy sales. But from a general economic assessment, we're seeing some slowness but not anything like we saw with residential here in Minnesota.

Do you expect that to change, or, I mean, I'm just sort of, in other words it just seems odd that it's only residential customers that are holding back, and that the rest of the guys seem to be sort of not impacted?

Well, I expect that it will be jurisdictionally specific. Here in Minnesota, if you broke it down, you'd see the C & I class probably decline from historic levels. In Texas, things are very robust in the Texas panhandle with oil and gas and agriculture. In Colorado, middle of the road, you do have oil and gas, you do have mining, but maybe a little bit of weakness. So I think it's really going to mirror the general economic trends of the states.

Great, thanks.

Thank you. Our next question comes from the line of Paul Ridzon with KeyBanc. Please go ahead.

Hey, Paul.

Paul, your line is now open.

I'm sorry, I was muted. Just wondering where you are in your various jurisdictions around decoupling, just kind of given what you're seeing with conservation, and then just wondering if you could clarify the third quarter impact on the nuclear outage deferral, and you kind of lost me there.

All right. Well, why don't we start with the nuclear deferral. We had asked the Commission to change the way we account for refueling expenses, and basically what we were trying to do is have those refueling expenses amortize over the life of the refueling, and that will tend to make for a more smooth outage, refueling outage expense between the years, because you know, we have one-year, two-year outages, and it creates a little bit of earnings volatility. Now, that change to accounting was approved by the Commission. However, they modified it with the provision that to the extent that the expense, after the amortization change is implemented, and that expense is less than what was last embedded in the last rate case we filed in Minnesota, that portion would have to be refunded to our customers, and that's exactly what we set up in the third quarter. The deferral of revenues and the margin offset by the reduction in O&M expense associated with the accounting change. Does that help on that question?

So now we are expensing the refueling over the life of the refuel cycle.

Right.

And if you come in, if you do better than forecast you owe a refund.

Not forecast. If we do better, if the expense for 2008 is less than the expense that was embedded in our last rate case in Minnesota, then we have to refund that difference. Keep in mind, Paul, we are going to be in a rate case in Minnesota next year so everything will get trued up.

And your expenses went below what you expected in this inflationary environment?

With the amortization, yes.

Okay, thank you. And then on decoupling?

What was the first question again, I'm sorry?

Just where we are with decoupling in the various jurisdictions.

We've been working on that on the gas side. On the electric side, we are certainly aware that as we implement conservation that we need to start thinking, if not decoupling, some other methods that keep us whole, and that's really where we are. Scott, I don't know if you want to add anything to that.

Most of our focus has been on trying to get loss margin recovery for our conservation programs. We've made some progress in Colorado and in Minnesota on that through various incentive measures. A broader decoupling look is something we have begun discussions about, but I would say they're in the early discussion phase.

Thank you very much.

Thank you. Our next question comes from the line of Chip Moore with Canaccord Adams. Please go ahead.

Hi, good morning. I wanted to ask a question about AQIR smart metering initiatives. It's my understanding that you have kind of a very targeted deployment in Boulder right now. Just wondering if you could bring us up to date there, and then maybe give us a sense of when you might look to potentially expand that program.

You are absolutely right, it is targeted. It's in Boulder. The project itself is about $100 million. We're funding $15 million of that, and it's really an A to Z proof of concept pilot program where we really start to understand what Smart Grid can mean in terms of carbon reduction, efficiency, conservation efforts, and reliability, and we're going to understand those things as we implement the pilot program, and it's been very well received. And we'll be in a better position, I believe, at the end next year to assess what makes sense to discuss with our Commissions about taking forward to the next step.

Okay. If I could just follow up briefly, is that, have you chosen the technology for that, or is that something that's still open?

It's still open. We have vendor and partners that are making the contributions, but we're still relatively open to technology choices.

All right, thanks for taking my questions.

Okay.

Thank you. (OPERATOR INSTRUCTIONS) And our next question is from the line of Travis Miller with Morning Star. Please go ahead.

Hey, Travis.

Hello. I was wondering what regulatory steps you plan on taking or have to take to adjust to these lower demands forecast particularly in these two years, and then how that might affect kind of the post-2009. Certainly in Minnesota, since you said most of that demand reduction you have seen there.

Well, Travis, the most immediate step, as you have mentioned, in Minnesota, is filing a rate case which we plan to do. In Minnesota, after you file, you are allowed to implement interim rates sixty days later. And so we will file with the assumption our best assumptions at this point suggest that sales will remain flat next year, and so you pick that up in a rate case. As Scott had mentioned, if we are a leader in conservation, among other environmental leadership efforts, and we are looking at various ways to compensate for the margin, we made a lot of progress on that, ultimately things, sustain things like decoupling and what have you, could potentially be items that we discuss, but at this point, we don't find that to be necessary.

Okay. Do you have a projection for '08 on your earned returns, based on what's happening third quarter, how that would be affected in Minnesota?

Earned returns as far as ROEs?

Yeah.

Yeah, I think your ROEs, depending on the jurisdiction, remember, we have a little extra leverage at the holdco. We'll probably be in the low 9%s, depending on the jurisdiction, it all depends, but that's the sort of information that will true up, and we'll be better able to speak to you as we issue formal guidance.

Okay, thank you very much.

Travis that would be about where we -- that would be consistent with roughly where we are this year, too.

That would be in the rate case the low 9%?

No, no. You asked, I'm glad you followed up on that. We'll ask for an ROE that is reflective of current capital conditions, but on a consolidated basis, we're in multiple jurisdictions, we have gas and electric operations, you have a lot of different things. So at the end of the day, we don't typically, and haven't typically been earning our authorized ROEs.

Sure. The low 9% figure you gave was for Minnesota 2008. Earned.

Minnesota 2008, yeah, that's probably approximately right.

Okay. Thank you.

Thank you. Our next question comes from the line of Dan Jenkins with the State of Wisconsin Investment Board. Please go ahead.

Hey, Dan.

Hi, how are you?

Good.

Just first, I want to follow up on the nuclear outage expense deferral process. So I guess going forward, so that will smooth out your accounting, too? I would assume, then, so your results won't vary as much based on when there's outages and when there are not. Is that true?

Yeah, that's correct.

And so what would be, I guess, kind of that normalized level? Is there a year that's kind of typical of what you would expect that on a smoothed basis?

Well, an outage, what is an outage typically run? $25 million? So you'll just start to see $25 million, I guess. I'm not going to try to run the numbers, but you'll see that cost amortized over the refueling outage for all three of our units.

So, you know, Dan, the way to look at it, there's three units. In some years you have two outages, some years you have one. So it's going to be somewhere in that $25 million to $50 million per nuclear outage, assuming kind of normal length, etc.

Okay. You mentioned that if you underspend that you have to refund that. What about if the costs are above what was in the rate case? Is there a mechanism for recovering that?

Dan, I think, just remember that we're going into a rate case next year, so so it's all going to get trued up. And the Commission was just concerned that before we go into, they could have easily said let's address that in rate case. They appreciated the accounting change, and they just wanted to make sure that it didn't create essentially a windfall for us, so they went back, and we looked at what was the last embedded thing in the rate case that we had previously filed, and said, don't recover anymore of that. Now, when we go into next year, that all gets trued up.

Okay. So it's really just interim?

For another three months.

Right. The next rate case cycle, essentially.

Right.

Okay. I appreciate that also you put in the information on the liquidity and all of that, but I was curious going forward what your funding needs are going to be given market conditions. Looks like you don't really have much maturities until the second half of '09.

That's correct, Dan. We have a light maturity schedule next year. What's on the plate for us, either this year or early next, is the, up to, I should emphasize that, a $250 million bond at SPS. And then we have an additional $450 million of maturities at NSP-Minnesota and PSCo. I think our total financing needs excluding SPS next year will probably roughly be in the $800 million range, and they will be first mortgage bonds that we'll be issuing. So the steps we've taken issuing equity, getting ahead of our funding needs this year, I think have really put us in a good position in '09, and even stepping back, as I mentioned on the call, we've always looked at what we call liquidity traps. We took advantage of the markets when they were strong to roll our credit facilities. We had a $600 million maturity at the holding company in 2010. We reduced that maturity by taking half of it, and spreading it out to 2017. So we've always been sensitive to liquidity, and we've always tried to get ahead of it and not have it be on top of us.

Okay, thank you.

Our next question is a follow-up from the line of Danielle Seitz with Seitz Research. Please go ahead.

Actually, you just answered my question. Thank you very much.

You're welcome.

Thank you. At this time, we have no additional questions. I'd like to turn it back to management for any closing remarks.

Thanks, everyone, for joining us on the call. If you have any more questions, feel free to call Paul Johnson and our IR team. Look forward to seeing you all at EEI. Thanks.

Thank you, sir. Ladies and gentlemen, that does conclude our conference for today. If you would like to listen to a replay please dial 1-800-405-2236, or 303-590-3000, using the access code of 11120556. A.C.T. would like to thank you for your participation.