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NORTHERN STATES POWER $80 MILLION FIRST MORTGAGE BONDS RATED 'AA' BY FITCH -- FITCH FINANCIAL WIRE --

 NEW YORK, April 2 /PRNewswire/ -- Northern States Power Co.'s (Minnesota) new issue of $80 million 6.375 percent first mortgage bonds due April 1, 2003, is rated `AA' by Fitch. The bonds are a takedown from a previously rated shelf registration. The credit trend is stable.
 The rating reflects qualitative strengths such as low cost operations, a healthy service territory, good nuclear and coal plant performance, minimal acid rain exposure, and management's commitment to maintain a strong balance sheet despite construction financing stress.
 Although NSP has no baseload construction planned until shortly after the turn of the century, the company estimates capital expenditures will increase about 53 percent to $2.6 billion over the next five years. The higher expenditures, slated for transmission upgrades, two peaking units, nuclear fuel, and replacements and improvements for its electric and gas system will require ongoing rate support.
 The company's 1992 financial performance was negatively impacted by the unusually mild weather which reduced annual revenues by $85 million. Full-year earnings from continuing operations were $161 million, a 22 percent drop from 1991, and pre-tax interest coverage fell to 3.25 times (x) from 4.02x. The balance sheet remains strong, however, with debt leverage at a conservative 44 percent of capitalization.
 The company's credit outlook and future earnings power will depend importantly on a pending electric and gas rate increase request. Following a $119 million electric and $14.9 million gas rate request, the Minnesota Public Utilities Commission authorized interim electric and gas rate increases of $71.2 million and $8.4 million respectively effective Jan.1, 1993. A final decision on both requests is expected in September. On Feb. 19, 1993, the Minnesota Department of Public Service, which represents consumer interests, recommended an electric rate increase of only $23.3 million based upon a return on average common equity of 10.75 percent.
 -0- 4/2/93
 /CONTACT: Ed King of Fitch, 212-908-0574/
 (NSP)


CO: Northern States Power Co. ST: Minnesota IN: UTI SU: RTG

WB -- NY076 -- 2701 04/02/93 17:34 EST
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Date:Apr 2, 1993
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