Northern States Power Essay, Research Paper

A leader in today’s economic world, Northern States

Power (NSP) is recognized for its outstanding performance

in both regulated and nonregulated operations. Its regulated

operation serves over two million electric and gas

customers in Minnesota, Wisconsin, North Dakota, South

Dakota, Arizona, and Michigan (NSP – Investor’s

Overview 1). Its head offices are located in Minneapolis,

Minnesota, and the Chairman, President and Chief

Executive Officer (CEO) is Mr. James J. Howard III

(Howard 1). Its Viking Gas Transmission Company

Subsidiary owns and operates a 500-mile natural gas

pipeline (NSP – Investor’s Overview 1). Northern States

Power is one of the nation’s leading energy companies with

competitive rates, responsive service, and dependable and

reliable energy. A relationship with NSP began’s when they

sign up for services with them; moreover, when you choose

to live in a certain area. Some of the facts about NSP are

services/people, profit, rates, and sources of power,

standings, first aid/safety, Y2K, merger, and about how

they help within the community. In North Dakota, NSP

provides service to more than 80,000 electric customers

and 30,000 gas customers in Fargo, Grand Forks, Minot,

and many surrounding communities (NSP – Northern

Dakota 1). They have served in these communities for over

80 years (Northern States Power Energy Wise 2). "By

powering the world, NSP brings energy to (Howard 6):" ?

The international markets where we do business ? The

communities close to home where we contribute time and

money ? To customers, who have ever-increasing energy

needs and choices ? To employees, who make the energy

work ? And finally, to you?the shareholders?who have

placed trust in them The 24th straight year in a row to mark

growth for NSP was 1998. Northern States Power’s

common stocks are traded on three different exchanges:

New York Stock, Chicago Stock, and Pacific Stock. Its

ticker tape symbol is NSP. Newspaper stock tables list

NSP Company as NoStPw, NoStPwr, or NSPw (NSP -

Investor’s Overview’s 2). Northern States Power and its

subsidiaries reported earning of $52.3 million or 34 cents a

share, for the first quarter of 1999. Operating revenue for

the quarter was up 6 percent to $743.2 million. Warmer

weather, increased maintenance, and Y2K computer work

is the cause of the decreased earning (NSP First-quarter).

"Advantages to being a registered shareholder are (NSP -

Investor’s overview 2):" ? Dividend checks are sent directly

to you, deposited in the back account you designate, or

maybe reinvested in the company as you choose ? You

may purchase additional stock (through dividend

reinvestment and optional investment plans) with little or no

fees ? You may deposit your share certificates with the

company for safekeeping if you sign up for the Dividend

Reinvestment Program ? Shareholder company mailings

will be sent directly to your address "Electricity is an

extremely price-volatile commodity. The price of on-peak

electricity on 15 April 1998 ranged from $20 per

megawatt-hour to $38 per megawatt-hour. Competitive

prices serve us well today. But becomes an even greater

advantage in a competitive market (Howard 3)." In trying

to compare different electrical Service Companies, I talked

with my Uncle, Edward Schiele, from Karlsruhe, North

Dakota. I asked him what his monthly electric bill averages

and he said it is between $100 to $115 a month during the

winter months. Verendrye Electric Cooperative out of

Velva, North Dakota, services Karlsruhe with its electrical

needs. Karlsruhe is a rural community of around 150-200

people (Schiele, Edward). Our families electrical service

needs are serviced by NSP. My Mother, Virginia Schiele,

said our last electrical bill was only $41.49. That is a big

difference from my uncle’s bill. Additionally, my mother told

me that when we lived in Holiday Village Trailer Court we

were serviced by Verendrye Electric and the bill averaged

around $80 a month in the winter (Schiele, Virginia).

Across North Dakota they’re many different electrical

companies. Electricity from other utility companies can cost

up to 63 percent more than from Northern States Power.

In checking nine different companies, they ranged from

$72.50 a month with Cass County Electric to Northern

States Power at $49.68. Northern States Power has the

lowest electric rates for Northern Dakota customers. If

you’re looking for the best value, it definitely is Northern

States Power (Northern States Power Energy Wise 2).

There is always a challenge on energy pricing. In recent

years, many businesses have explored co-generation. That

is harnessing energy from the excess heat produced in

manufacturing (Brauer 2). Northern States Power is

investing in renewable sources of power. It is studying the

use of solar, wind, and biomass energy sources and how

they fit into our energizes future needs (Northern States

Power Company ? Home 2). During the 7th Century, the

ancient Persians were believed to have built the first

windmill. The earlier windmills use driving pumps or

grindstones to produce power. Today’s windmills use

blades and were once a common sight on American farms

(NSP ? Renew Wind 1). Wind turbines, the modern

counterpart of windmills, drive electric generators. A

turbine, installed on top of a tower, has three blades with a

rotor diameter of 160 feet. Towers average 100 to 175

feet tall (NSP ? Renew Wind 1). A turbine operates under

the same principal as an airplane wings. Lift is the force that

pulls the blades coveting the linear motion into rotational

motion that drives an electric generator. It takes 67 to 200

wind turbines to generate 100 megawatts of electricity

(NSP ? Renew Wind 2). As with all sources of generation,

NSP seeks to minimize the advantage and minimize the

disadvantages. They choose companies who can provide

the latest, most cost-effective technology and select sites

identified through extensive research as the windiest area.

Additionally, sites are chosen in close proximity to

transmission lines (NSP ? Renew Wind 2). Using solar

power goes back to 1839 when French scientist Edmond

Becquerel first discovered on that on certain material light

could create an electric charge. However, nothing became

of it until the 1960s when the United States space program

began the use of silicon-based photovoltaic cells to power

some satellite applications (NSP ? Solar 1). Usually made

of silicon, solar photovoltaic panels contain cells that

convert sunlight directly into electricity. These systems can

operate independently or be connected to utility electrical

grids already in use. Conducting research since 1982, the

use of grid-connected photovoltaics systems are what

interests NSP (NSP ? Solar 2). Biomass is the use of any

organic material that can be used as fuel. Examples include

agriculture, crops, trees, grasses, seed hulls, animal waste,

landfill gas, and wood wastes from forests, orchards, mills,

and construction. People have used these products to heat

homes for thousands of years. Today, some use biomass in

combination with other fuels to generate electricity (NSP ?

Biomass 1). Northern States Power uses wood waste to

produce electricity at one plant and at another it uses

landfill methane gas. However, extreme care must be taken

to use biomass in an environmentally responsible way

(NSP ? Biomass 1). Northern States Power has strong

traditional values for the protection for the environment.

They believe in protecting the delicate balance between the

need for reliable energy and minimizing the impact for

energy production and distribution. Among the utility

companies, NSP is a leader in a variety of initiatives to

preserve our natural resources, use renewable energy

sources, and minimize it’s impact on the environment (NSP

? Environmental 1). How does North and South Dakota

stand in items rates by NSP, lets take a look. All states

serviced by NSP had zero lost workdays in January 1999

and five lost workdays were noted in June 1998, the

Dakota’s showing none. The Dakota’s have zero incidents

noted in January 1999 for safety; but in June 1998 they had

two on the records. Other states reported a total of 56 lost

days up till June 1998 and six in January 1999 (Delivery 1).

For Projects Completed-on-Time, the Dakota’s have no

rating. All other states have a completion rate of 93

percent, the goal is 80 percent. To me, this shows NSP is

dedicated to quality service to their customers (Delivery 1).

Projects cost commissions are hard to estimate or rate; but,

to show you expenditures here are a few shockers.

Remember that all projected costs are in the millions. Fargo

shows $83, Grand Forks shows $102, Minot shows $87,

and Sioux Falls shows $79. Actual costs were $87 million

(Delivery 1). Northern States Power has budgeted $24

million for checking its equipment to make sure there are no

problems when the year 2000 arrives. Dealing with

electrical outages daily, NSP expects only a minimal

disruption of service to its customers (NSP ? First-quarter

B6). They have already confirmed the readiness of 70

percent of the equipment and systems. With 80 percent of

its systems pre-dating computers, there systems can be

operated manually. In one case, a sensing device was

placed into a millennium changeover, all it took was an

extra 1.5 of a second to operate, a time that will not impair

the system functions (NSP ? News Release 1 & 2).

Weather at home or work, standard first aid knowledge

and safety training is a must. No one knows the time or day

someone or even themselves may be hurt or become ill and

need helps (Missouri ii). Individuals working with electrical

lines encounter many situations that can cause injury if not

property though out and safety principles applied. First aid

is one of those subjects you must know, but hope that you

will never have to use (Missouri ii). On one such incident,

by brother, James Horsfall, was the first individual to

response. He had only been working as an Apprentice

Lineman for NSP for about one year when the accident

occurred. They were taken down and replacing an

overhead electrical line around Edina Prairie School when

the accident occurred. They had all the proper safety

guards up and an OSHA Safety Inspector was on the job

with them (Horsfall). Everything was going along fine until

kids on bikes started going in and around the orange safety

cones. A little later, a vehicle drove around the orange

cones and over the wires on the ground. When the vehicle

went over the wires, this caused them to go fling. One wire

clipped by brother in the back caves of his legs and he

went down (he was wearing knee high lineman boots). The

OSHA Safety Inspector was also caught off guard and was

clipped in the front of his legs just below the knees and

another wire chipped him in the back, just below his

shoulders (Horsfall). Ensuring his safety first, James

crawled to the safety inspector. He noted a massive bleed

to the head and immediately applied direct pressure to the

wound. He than instructed the gentleman not to move and

called for additional help (Horsfall). The OSHA Inspector

had minor abrasions and lacerations with a severe head

injury and was hospitalizes for two to three weeks. James

was commended for his fast action to assure the safety and

lesson the injury. The vehicles driver was cited for her

failure to observe the safety precautions in this incident.

Northern States Power’s action after this incident was to

place safety cones only five feet apart (Horsfall). Northern

States Power goes international when they entered into a

definitive merger agreement with the Denver, Colorado,

based New Century Energies (NSP – New Release 1).

The two utilities companies plan to create the nation’s

third-largest utility company servicing well over three million

customers in the Untied Sates and two million customers

internationally. The new yet to be named company will

stretch from the Canadian border to Mexico with a strong

global presence in the Untied Kingdom, Central Europe,

Australia, and South America (Padley 1). The merger is

expected to result in a net savings over the next 10 year of

over $1.1 billion. Additionally, it is expected to be a

tax-free, stock-for-stock exchange for shareholders of

both companies. This merger prepares the new company

for where the industry is going and not where it is today

which is important to customers of the future (NSP – New

Release 3). Working with retirees and their families, NSP

works to improve the quality of life in our communities.

They support local and national initiatives and provide

direct support for any involvement with schools, students,

and community-based organizations (NSP ? Community 1

& 2). "Northern States Power support’s a wide variety of

community based programs (NSP ? Community 1 & 2):" ?

Education Partnerships ? Event Support ? Energy

Education K-12 ? Calendar Contest K-6 ? Nonprofit

Board Participation ? Power Plant Tours ? Speakers

Bureau ? Volunteerism The majority of these programs are

based in the Minneapolis and St Paul, Minnesota, area; but

you can contact any NSP office to see what services are

available in your area. You can also request additional

information at [email protected] (NSP ? Community

1). To sum things up, it has been said NSP is the energy to

make things happen. In doing the math, I found that looking

at the services/people, sources of power, rates, profits,

Y2K, community involvement, and merger information that

you can’t go wrong in choosing NSP if you live in there

serving area. Northern States Power is the best value four

your money?any money does not go as far as it use to.

Customers who get there electrical and gas needs from

NSP or anyone of their subsidiaries are truly the winners in

today’s world and getting their monies worth.

Brauer, David. "NSP’s Grass-Roots Political Strategy."

Corporate Report ? Minnesota, Mar 94, Vol. 25, Issue 3,

P40, 1p Deliver System Construction & Field Operations.

Monthly Performance Update. January 1999 Howard,

James J. III. "1998 Shareholders Annual Meeting." Online.

Microsoft Explorer. Internet. 22 March 1999. Available:

http://www.nspco.com/ nsp/jjhspeech/jh042298.htm

Missouri Valley Line Constructors Apprenticeship. "First

Aid." September 1993 NSP – Biomass. Online. Microsoft

Explorer. Internet. 25 March 1999. Available:

http://www.nspco.com/renewables/biomass.htm NSP ?

Community Involvement. Online. Microsoft Explorer.

Internet. 22 March 1999. Available:

http://www.nspco.com/nsp/Community%20involvement/

cominv.htm NSP – Environmental Initiaitives. Online.

Microsoft Explorer. Internet. 22 March 1999. Available:

http://www.nspco.com/environ.htm NSP First-quarter

Earning Cut. Minot Daily News 16 April 1999: B6 NSP -

News Release. Online. Microsoft Explorer. Internet. 25

March 1999. Available

http://nspco.com/nsp/nwsrel/nwsrel98/123098.htm NSP -

News Release. Online. Microsoft Explorer. Internet. 26

March 1999. Available

http://nspco.com/nsp/nwsrel/032599nr.htm NSP – North

Dakota. Online. Microsoft Explorer. Internet. 22 March

1999. Available http://www.nspco.com/nsp/nd.htm NSP ?

Renew Wind. Online. Microsoft Explorer. Internet. 25

March 1999. Available:

http://www.nspco.com/renewables/wind.htm NSP – Solar.

Online. Microsoft Explorer. Internet. 25 March 1999.

Available: http://www.nspco.com/renewables/solar.htm

Northern States Power Investor’s Overview. Online.

Microsoft Explorer. Internet. 22 March 1999. Available:

http://www.corporate-ir.net/ ireye/ ir_site.zhtml?

ticker=nsp&script= 2100&layout=7 Northern States

Power Energy Wise (Publication for NSP Customers)

Spring 1999 Northern States Power Company ? Home

Page. Online. Microscoft Explorer. Internet. 22 March

1999. Available: http://www.nspco.com/ Padley, Karen.

"NSP, Denver Utility to Merge." Saint Paul Pioneer Press,

Minnesota. 25 March 1999. Northern States Power is one

of the nation’s leading energy companies with competitive

rates, responsive service, and dependable and reliable

energy. Introduction I. Services/People A. ND Customer’s

B. Responsible II. Profit A. Growth B. Exchanges C.

Benefits to Shareholders III Rates A. Prices B.

Comparisons C. Bottom Line IV Sources of Power A.

Wind B. Solar C. Biomass D. Environmental V Standings

A. Lost Work Days B. Safety Incident’s C. Projects

On-Time VI Y2K A. Budget C. Completed VI First Aid /

Safety A. Time B. Knowledge C. Incident D. Outcome

VIII Merger A. Reliable X Community A. Programs

Supported B. Contact Conclusion