Xcel Energy Inc. has increased its mid-term capital spending plans by about $5 billion since the end of March 2025, due to two large transmission project awards, and strong demand growth from data centers. Transmission work will account for a large component of the larger incremental capex outlook.
The awarded transmission projects are part of a larger effort called the Joint Targeted Interconnection Queue (JTIQ), a first-of-its-kind collaboration between two regional transmission organizations: the Midcontinent Independent System Operator (MISO) and the Southwest Power Pool (SPP), with coordination from the Minnesota Department of Commerce. The projects will help to fund the construction of high voltage transmission lines that improve reliability, resolve constraints in the transmission system, and open the door for up to 30 GW of new generation, much of which will be wind energy. The five JTIQ transmission projects will span seven states: Iowa, Kansas, Minnesota, Missouri, Nebraska, North Dakota and South Dakota. Xcel Energy is co-developing two of the five segments: one in collaboration with Otter Tail Power in North Dakota, and another in collaboration with ITC in Minnesota.
In total, Xcel has been awarded about $2 billion worth of work on SPP reliability projects, as well as between $1 billion and $2 billion of work from MISO. Those investments will be on top of transmission’s nearly $12.6 billion share of Xcel’s official $45 billion five-year investment plan.
Earlier this year, the company told analysts and investors that they thought their $45 billion base capital plan through 2029 had the potential to grow by about $10 billion, as they catch up to load growth in their service areas due to strong demand from oil-and-gas customers as well as investments in the electrification of transportation, manufacturing and home heating. Data center operators have requested 8.9 GW of power to come online between now and the end of 2029.
In the three months that ended June 30, 2025, Xcel produced net profits of $444 million on total operating revenues of nearly $3.3 billion. Those figures were up from $302 million and $3.0 billion, respectively, in the same period in 2024.
Alongside their earnings, Xcel is also dealing with two wildfire cases – the Smokehouse Creek Fire Complex in Texas’ Panhandle of early 2024 and the late-2021 Marshall Fire in Colorado’s Boulder County. The key issue in the Marshall case is an assertion by the local sheriff’s office that Xcel’s equipment caused the second of two ignitions in the area and that the company is liable for some of the estimated $2 billion in damages. The company disputes that assertion. In the Smokehouse case, the company has agreed to settlements with area residents that are worth a combined $176 million.