Xcel Energy XEL announced that it has received a renewal of its carbon-free Monticello Nuclear Generating plant’s operating license from the U.S. Nuclear Regulatory Commission (“NRC”). This should help the company support its clean energy vision.

More than 500,000 households in the Upper Midwest are powered by the Monticello plant each year, making it a vital source of clean, safe and reliable electricity. Nuclear energy is XEL’s sole carbon-free energy source that is available around the clock. Hence, it’s essential to accelerate its transition to a clean energy future while ensuring that it can satisfy its customers' historically high demand for power.

Key Details of the Approval

The federal approval allows the plant to operate for an additional 20 years, through 2050, provided the plant’s extended operation is also approved by state regulators. Monticello’s continued operation will ensure that nuclear energy plays a foundational role in Xcel Energy’s transition to 100% carbon-free electricity.

The plant's license renewal is the result of a multi-year process in which the NRC conducted numerous inspections, audits and reviews of every technical aspect of the plant to ensure it met safety, environmental and other standards.

Xcel Energy plans to seek approval from state regulators to match a 20-year extension of its federal operating license. The company already has approval from the Minnesota Public Utilities Commission to extend Monticello operations for the first half of the year through 2040, and it will seek approval from the commission for another 10 years.

Xcel Energy’s Focus on Emission Reduction

XEL is focusing on clean-energy transition. It received regulatory approval for the Minnesota resource plan, which includes the closing of coal plants like the A.S. King Plant by 2028 and Sherco 3 by 2030. In 2023, Northern States Power Company (“NSP”)-Minnesota issued request for proposal seeking approximately 1.2 gigawatt (GW) of wind development assets to replace capacity and reutilize interconnection rights associated with the retiring Sherco coal facilities.

In 2024, NSP filed its Upper Midwest Resource Plan, which includes 3.6 GW of new wind and solar resources, 600 MW of battery energy storage and more than 2.2 GW of dispatchable resources by 2030. This will help reduce carbon emissions by more than 80%, potentially up to 88%, by 2030.

The conversion of its Pawnee coal plant to natural gas by the end of 2025 and the early retirement of the Comanche 3 coal unit by the end of 2030 will mark the final coal plant retirement in Colorado. The addition of new clean energy projects will assist the company in achieving the net-zero emission target set for 2050.

Utilities’ Focus on Clean Energy

Per the U.S. Energy Information Administration, the annual share of U.S. electricity generation from renewable energy sources is expected to be 23% and 25% in 2024 and 2025, respectively.

Along with XEL, some other companies like Dominion Energy D, Duke Energy DUK and CenterPoint Energy CNP are also taking initiatives to lower emissions and deliver clean energy to customers.

Dominion aims to attain net-zero carbon and methane emissions from its electric generation and natural gas infrastructure by 2050. The company aims to cut emissions by 70-80% within 2035 from the level of 2005. By 2035, Dominion also intends to make zero and low-emitting resources accountable for 99% of the company’s electric generation. The company is working on offshore wind, battery storage and hydropower projects to lower emissions.

D’s long-term (three-to-five-year) earnings growth rate is 13.64%. The Zacks Consensus Estimate for 2025 earnings per share (EPS) indicates a year-over-year increase of 22.9%.

Duke Energy has been making strong progress in reducing carbon emissions from electricity generation. The company has already lowered its carbon emissions from 139 million metric tons in 2005 to 72 million metric tons in 2023. It is currently working to reduce Scope 2 and certain Scope 3 emissions, including emissions from upstream purchased power and fossil fuel purchases, as well as downstream customer use of natural gas, by 50% below 2021 levels by 2035.

DUK’s long-term earnings growth rate is 6.35%. The Zacks Consensus Estimate for 2025 EPS indicates a year-over-year increase of 6.7%.

CenterPoint Energy aims to produce 80% of its energy from wind and solar resources by 2030 and reduce carbon emissions from its electric generation fleet by 97% by 2030-end, attaining its net-zero emission goal by 2035.

CNP’s long-term earnings growth rate is 7.12%. The Zacks Consensus Estimate for 2025 EPS indicates a year-over-year increase of 7.3%.

XEL’s Stock Price Performance

In the past six months, shares of XEL have risen 26.8% compared with the industry’s 5.6% growth.

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XEL’s Zacks Rank

The company currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

 

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