Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.

This Form 10-Q is filed by Northern States Power Company, a Wisconsin corporation (NSP-Wisconsin).  NSP-Wisconsin is a wholly owned subsidiary of Xcel Energy Inc.  Xcel Energy Inc. wholly owns the following subsidiaries: Northern States Power Company, a Minnesota corporation (NSP-Minnesota); Southwestern Public Service Company, a New Mexico corporation (SPS); Public Service Company of Colorado, a Colorado corporation (PSCo); and NSP-Wisconsin.  NSP-Minnesota, NSP-Wisconsin, PSCo and SPS are also referred to collectively as utility subsidiaries.  The electric production and transmission system of NSP-Minnesota and NSP-Wisconsin, which is operated on an integrated basis and is managed by NSP-Minnesota, is referred to collectively as the NSP System. Additional information on Xcel Energy Inc. and its subsidiaries (collectively, Xcel Energy) is available on various filings with the Securities and Exchange Commission (SEC).

In the opinion of management, the accompanying unaudited consolidated financial statements contain all adjustments necessary to present fairly, in accordance with accounting principles generally accepted in the United States of America (GAAP), the financial position of NSP-Wisconsin and its subsidiaries as of Sept. 30, 2015March 31, 2016 and Dec. 31, 2014;2015; the results of its operations, including the components of net income and comprehensive income, for the three months ended March 31, 2016 and nine months ended Sept. 30, 2015 and 2014;2015; and its cash flows for the ninethree months ended Sept. 30, 2015March 31, 2016 and 2014.2015. All adjustments are of a normal, recurring nature, except as otherwise disclosed. Management has also evaluated the impact of events occurring after Sept. 30, 2015March 31, 2016 up to the date of issuance of these consolidated financial statements. These statements contain all necessary adjustments and disclosures resulting from that evaluation. The Dec. 31, 20142015 balance sheet information has been derived from the audited 20142015 consolidated financial statements included in the NSP-Wisconsin Annual Report on Form 10-K for the year ended Dec. 31, 2014.2015. These notes to the consolidated financial statements have been prepared pursuant to the rules and regulations of the SEC for Quarterly Reports on Form 10-Q. Certain information and note disclosures normally included in financial statements prepared in accordance with GAAP on an annual basis have been condensed or omitted pursuant to such rules and regulations. For further information, refer to the consolidated financial statements and notes thereto, included in the NSP-Wisconsin Annual Report on Form 10-K for the year ended Dec. 31, 2014,2015, filed with the SEC on Feb. 23, 2014.22, 2016. Due to the seasonality of NSP-Wisconsin’s electric and natural gas sales, interim results are not necessarily an appropriate base from which to project annual results.

The significant accounting policies set forth in Note 1 to the consolidated financial statements in the NSP-Wisconsin Annual Report on Form 10-K for the year ended Dec. 31, 2014,2015, appropriately represent, in all material respects, the current status of accounting policies and are incorporated herein by reference.

Revenue Recognition —In May 2014, the Financial Accounting Standards Board (FASB) issued Revenue from Contracts with Customers, Topic 606 (Accounting Standards Update (ASU) No. 2014-09), which provides a framework for the recognition of revenue, with the objective that recognized revenues properly reflect amounts an entity is entitled to receive in exchange for goods and services. The new guidance also includes additional disclosure requirements regarding revenue, cash flows and obligations related to contracts with customers. As a result of the FASB’s deferral of the standard’s required implementation date in July 2015, theThe guidance is effective for interim and annual reporting periods beginning after Dec. 15, 2017. NSP-Wisconsin is currently evaluating the impact of adopting ASU 2014-09 on its consolidated financial statements.

Consolidation — In February 2015, the FASB issued Amendments to the Consolidation Analysis, Topic 810 (ASU No. 2015-02), which reduces the number of consolidation models and amends certain consolidation principles related to variable interest entities. ThisNSP-Wisconsin implemented the guidance will be effective for interimon Jan. 1, 2016, and annual reporting periods beginning after Dec. 15. 2015, and early adoption is permitted. NSP-Wisconsin does not expect the implementation of ASU 2015-02 todid not have a materialsignificant impact on its consolidated financial statements.

Presentation of Debt Issuance Costs — In April 2015, the FASB issued Simplifying the Presentation of Debt Issuance Costs, Subtopic 835-30 (ASU No. 2015-03), which amends existing guidance to requirerequires the presentation of debt issuance costs on the balance sheet as a deduction from the carrying amount of the related debt, instead of presentation as an asset. ThisNSP-Wisconsin implemented the new guidance will be effective for interimas required on Jan. 1, 2016, and annual reporting periods beginning after Dec. 15, 2015, and early adoption is permitted. Other thanas a result, $5.0 million of deferred debt issuance costs are presented as a deduction from the prescribed reclassificationcarrying amount of assets to an offset oflong-term debt on the consolidated balance sheets, NSP-Wisconsin does not expectsheet as of March 31, 2016, and $5.1 million of such deferred costs were retrospectively reclassified from other non-current assets to long-term debt on the implementationconsolidated balance sheet as of ASU 2015-03 to have a material impact on its consolidated financial statements.Dec. 31, 2015.

Fair Value Measurement — In May 2015, the FASB issued Disclosures for Investments in Certain Entities that Calculate Net Asset Value per Share (or Its Equivalent), Topic 820 (ASU No. 2015-07), which removeseliminates the requirement to categorize within the fair value hierarchy the fair values for investments measuredmeasurements using a net asset value methodology. This(NAV) methodology in the fair value hierarchy. NSP-Wisconsin implemented the guidance will be effective on a retrospective basis for interimJan. 1, 2016, and annual reporting periods beginning after Dec. 15, 2015, and early adoption is permitted. Other than the reduced disclosure requirements, NSP-Wisconsin does not expect the implementation of ASU 2015-07 todid not have a material impact on its consolidated financial statements.

Except to the extent noted below, Note 6 to the consolidated financial statements included in NSP-Wisconsin’s Annual Report on Form 10-K for the year ended Dec. 31, 20142015 appropriately represents, in all material respects, the current status of other income tax matters, and are incorporated herein by reference.

Federal Audit — NSP-Wisconsin is a member of the Xcel Energy affiliated group that files a consolidated federal income tax return. In the third quarter of 2012, the Internal Revenue Service (IRS) commenced an examination of tax years 2010 and 2011, including the 2009 carryback claim. As of Sept. 30, 2015,March 31, 2016, the IRS had proposed an adjustment to the federal tax loss carryback claims that would result in $13$14 million of income tax expense for the 2009 through 2011 and 2013 claims, the recently filed 20132014 claim, and the anticipated claim for 2014.2015. NSP-Wisconsin is not expected to accrue any income tax expense related to this adjustment. AsIn the fourth quarter of Sept. 30, 2015, the IRS had begunforwarded the appeals process;issue to the Office of Appeals (Appeals); however, the outcome and timing of a resolution is uncertain. The statute of limitations applicable to Xcel Energy’s 2009-20112009 through 2011 federal income tax returns expires in December 2016 following an extension to allow additional time for the appealsAppeals process. In the third quarter of 2015, the IRS commenced an examination of tax years 2012 and 2013. As of Sept. 30, 2015,March 31, 2016, the IRS had not proposed any material adjustments to tax years 2012 and 2013.

State Audits — NSP-Wisconsin is a member of the Xcel Energy affiliated group that files consolidated state income tax returns. As of Sept. 30, 2015,March 31, 2016, NSP-Wisconsin’s earliest open tax year that is subject to examination by state taxing authorities under applicable statutes of limitations is 2011. As of Sept. 30, 2015,March 31, 2016, there were no state income tax audits in progress.

Unrecognized Tax Benefits — The unrecognized tax benefit balance includes permanent tax positions, which if recognized would affect the annual effective tax rate (ETR). In addition, the unrecognized tax benefit balance includes temporary tax positions for which the ultimate deductibility is highly certain but for which there is uncertainty about the timing of such deductibility. A change in the period of deductibility would not affect the ETR but would accelerate the payment of cash to the taxing authority to an earlier period.

A reconciliation of the amount of unrecognized tax benefit is as follows:

The unrecognized tax benefit amounts were reduced by the tax benefits associated with net operating loss (NOL) and tax credit carryforwards. The amounts of tax benefits associated with NOL and tax credit carryforwards are as follows:

It is reasonably possible that NSP-Wisconsin’s amount of unrecognized tax benefits could significantly change in the next 12 months as the IRS appeals processAppeals and audit progress and state audits resume. As the IRS appeals process moves closer to completion,Appeals and audit progress, it is reasonably possible that the change in theamount of unrecognized tax benefit is not expectedcould decrease up to be material.approximately $2 million.

The payable for interest related to unrecognized tax benefits is partially offset by the interest benefit associated with NOL and tax credit carryforwards. The payables for interest related to unrecognized tax benefits at Sept. 30, 2015March 31, 2016 and Dec. 31, 20142015 were not material. No amounts were accrued for penalties related to unrecognized tax benefits as of Sept. 30, 2015March 31, 2016 or Dec. 31, 2014.2015.

In 2013, the MPUC initiated an investigation to determine whether the final costs for the Monticello LCM/EPU project were prudent.

NSP-Minnesota has recorded a current liability representing the current best estimate of a refund obligation associated with the new ROE, including the RTO membership adder, as of Sept. 30, 2015.March 31, 2016. The new FERC ROE methodology is estimated to reduce transmission revenue, net of expense, between $7$8 million and $9$10 million, annually, for the NSP System.

Except to the extent noted below and in Note 5 above, the circumstances set forth in Notes 10 and 11 to the consolidated financial statements included in NSP-Wisconsin’s Annual Report on Form 10-K for the year ended Dec. 31, 2014 and in Notes 5 and 6 to the consolidated financial statements included in NSP-Wisconsin’s Quarterly Reports on Form 10-Q for the quarterly periods ended March 31, 2015 and June 30, 2015, appropriately represent, in all material respects, the current status of commitments and contingent liabilities, and are incorporated herein by reference. The following include commitments, contingencies and unresolved contingencies that are material to NSP-Wisconsin’s financial position.

NSP-Wisconsin provides a guarantee for payment of customer loans related to NSP-Wisconsin’s farm rewiring program. NSP-Wisconsin’s exposure under the guarantee is based upon the net liability under the agreement. The guarantee issued by NSP-Wisconsin limits its exposure to a maximum amount stated in the guarantee. The guarantee contains no recourse provisions and requires no collateral.

The following table presents the guarantee issued and outstanding for NSP-Wisconsin:

In 2011, the EPA issued special notice letters identifying several entities, including NSP-Wisconsin, as PRPs, for future remediation at the Ashland site. As a result of settlement negotiations with NSP-Wisconsin, the EPA agreed to segment the Ashland site into separate areas. The first area (Phase I Project Area) includes soil and groundwater in Kreher Park and the Upper Bluff. The second area includes the Sediments.

In August 2012, NSP-Wisconsin also filed litigation againstThree other PRPs for their share of the cleanup costs for the Ashland site. A final settlement has been reached between NSP-Wisconsin, along with the EPA, and two of the PRPs, Wisconsin Central Ltd. and Soo Line Railroad Co. (collectively, the “Railroad PRPs”) resolving claims relating to the Railroad PRPs’ share of the costs of cleanup at the Ashland site. NSP-Wisconsin also entered into a second private party settlement agreement with LE Myers Co. Under the agreements, the Railroad PRPshave contributed $10.5 million and LE Myers Co. contributed $5.4$15.9 million to the costsremediation of the cleanup at the Ashland site. The agreements for the Railroad PRPssite, as a result of litigation and LE Myers Co. weresettlements approved by the U.S. District Court for the Western District of Wisconsin in 2015 and payment has been received. As discussed below, existing PSCW policy requires that any payments received from2015. NSP-Wisconsin’s litigation effort against other PRPs be used to reduce the amount of the cleanup costs ultimately recovered from customers. Trial with the remaining PRPs for this matter, County of Ashland and City of Ashland, took place in May 2015. In September 2015, the Court ruled that the County of Ashland is not a liable party and the City of Ashland, although a liable party, is not required to contribute any funds to the cleanup of the site. NSP-Wisconsin filed a notice of appeal with the Seventh Circuit Court of Appeals in October 2015.now complete.

NSP-Wisconsin is involved in various litigation matters that are being defended and handled in the ordinary course of business. The assessment of whether a loss is probable or is a reasonable possibility, and whether the loss or a range of loss is estimable, often involves a series of complex judgments about future events. Management maintains accruals for such losses that are probable of being incurred and subject to reasonable estimation. Management is sometimes unable to estimate an amount or range of a reasonably possible loss in certain situations, including but not limited to when (1) the damages sought are indeterminate, (2) the proceedings are in the early stages, or (3) the matters involve novel or unsettled legal theories. In such cases, there is considerable uncertainty regarding the timing or ultimate resolution of such matters, including a possible eventual loss. For current proceedings not specifically reported herein, management does not anticipate that the ultimate liabilities, if any, arising from such current proceedings would have a material effect on NSP-Wisconsin’s financial statements. Unless otherwise required by GAAP, legal fees are expensed as incurred.

Letters of Credit — NSP-Wisconsin uses letters of credit, generally with terms of one year, to provide financial guarantees for certain operating obligations. At Sept. 30, 2015March 31, 2016 and Dec. 31, 2014,2015, there were no letters of credit outstanding.

At Sept. 30, 2015,March 31, 2016, NSP-Wisconsin had the following committed credit facility available (in millions of dollars):

All credit facility bank borrowings, outstanding letters of credit and outstanding commercial paper reduce the available capacity under the credit facility. NSP-Wisconsin had no direct advances on the credit facility outstanding at Sept. 30, 2015March 31, 2016 and Dec. 31, 2014.2015.

Other Short-Term Borrowings — The following table presents the notes payable of Clearwater Investments, Inc., a NSP-Wisconsin subsidiary, to Xcel Energy Inc.:

The accounting guidance for fair value measurements and disclosures provides a single definition of fair value and requires certain disclosures about assets and liabilities measured at fair value.  A hierarchical framework for disclosing the observability of the inputs utilized in measuring assets and liabilities at fair value is established by this guidance. The three levels in the hierarchy are as follows:

Specific valuation methods include the following:

Cash equivalents — The fair values of cash equivalents are generally based on cost plus accrued interest; money market funds are measured using quoted net asset values.prices.

Interest rate derivatives — The fair values of interest rate derivatives are based on broker quotes that utilize current market interest rate forecasts.

Commodity derivatives — The methods used to measure the fair value of commodity derivative forwards and options utilize forward prices and volatilities, as well as pricing adjustments for specific delivery locations, and are generally assigned a Level 2.  When contractual settlements extend to periods beyond those readily observable on active exchanges or quoted by brokers, the significance of the use of less observable forecasts of long-term forward prices and volatilities on a valuation is evaluated, and may result in Level 3 classification.

NSP-Wisconsin enters into derivative instruments, including forward contracts, futures, swaps and options for trading purposes and to manage risk in connection with changes in interest rates and utility commodity prices.

At Sept. 30, 2015,March 31, 2016, accumulated other comprehensive loss related to interest rate derivatives included $0.1 million of net losses expected to be reclassified into earnings during the next 12 months as the related hedged interest rate transactions impact earnings, including forecasted amounts for unsettled hedges, as applicable.

The following table details the gross notional amounts of commodity options at Sept. 30, 2015March 31, 2016 and Dec. 31, 2014:2015:

During the three months and nine months ended Sept. 30, 2015,March 31, 2016, changes in the fair value of natural gas commodity derivatives resulted in immaterial and $0.1 million of net losses recognized as regulatory assets and liabilities, respectively. For the three and nine months ended Sept. 30, 2014,March 31, 2015, changes in the fair value of natural gas commodity derivatives resulted in immaterial net losses and net gains of $0.7 million, respectively, recognized as regulatory assets and liabilities. The classification as a regulatory asset or liability is based on commission approved regulatory recovery mechanisms.

Natural gas commodity derivatives settlement losses of $1.0$0.6 million and gains of $0.5$1.0 million were recognized for the ninethree months ended Sept. 30,March 31, 2016 and 2015, and 2014, respectively, and were subject to purchased natural gas cost recovery mechanisms, which result in reclassifications of derivative settlement gains and losses out of income to a regulatory asset or liability, as appropriate. There were immaterial natural gas commodity derivatives settlement losses recognized during the three months ended Sept. 30, 2015 and 2014, respectively.

NSP-Wisconsin had no derivative instruments designated as fair value hedges during the three and nine months ended Sept. 30, 2015March 31, 2016 and 2014.2015. Therefore, no gains or losses from fair value hedges or related hedged transactions were recognized for these periods.

Consideration of Credit Risk and Concentrations — NSP-Wisconsin continuously monitors the creditworthiness of the counterparties to its interest rate derivatives and commodity derivative contracts prior to settlement, and assesses each counterparty’s ability to perform on the transactions set forth in the contracts. Given this assessment, as well as an assessment of the impact of NSP-Wisconsin’s own credit risk when determining the fair value of derivative liabilities, the impact of considering credit risk was immaterial to the fair value of unsettled commodity derivatives presented in the consolidated balance sheets.

NSP-Wisconsin employs additional credit risk control mechanisms when appropriate, such as letters of credit, parental guarantees, standardized master netting agreements and termination provisions that allow for offsetting of positive and negative exposures. Credit exposure is monitored and, when necessary, the activity with a specific counterparty is limited until credit enhancement is provided.

As of Sept. 30, 2015March 31, 2016 and Dec. 31, 2014,2015, other financial instruments for which the carrying amount did not equal fair value were as follows:

The fair value of NSP-Wisconsin’s long-term debt is estimated based on recent trades and observable spreads from benchmark interest rates for similar securities. The fair value estimates are based on information available to management as of Sept. 30, 2015March 31, 2016 and Dec. 31, 2014,2015, and given the observability of the inputs to these estimates, the fair values presented for long-term debt have been assigned a Level 2.

Other income, (expense), net consisted of the following:

Operating results from the regulated electric utility and regulated natural gas utility are each separately and regularly reviewed by NSP-Wisconsin’s chief operating decision maker.  NSP-Wisconsin evaluates performance based on profit or loss generated from the product or service provided.  These segments are managed separately because the revenue streams are dependent upon regulated rate recovery, which is separately determined for each segment.

NSP-Wisconsin has the following reportable segments: regulated electric utility, regulated natural gas utility and all other.

Asset and capital expenditure information is not provided for NSP-Wisconsin’s reportable segments because as an integrated electric and natural gas utility, NSP-Wisconsin operates significant assets that are not dedicated to a specific business segment, and reporting assets and capital expenditures by business segment would require arbitrary and potentially misleading allocations which may not necessarily reflect the assets that would be required for the operation of the business segments on a stand-alone basis.

To report income from operations for regulated electric and regulated natural gas utility segments, the majority of costs are directly assigned to each segment.  However, some costs, such as common depreciation, common operating and maintenance (O&M)O&M expenses and interest expense are allocated based on cost causation allocators.  A general allocator is used for certain general and administrative expenses, including office supplies, rent, property insurance and general advertising.

In January 2015,2016, contributions of $90.0$125.0 million were made across four of Xcel Energy’s pension plans, of which $4.9$7.4 million was attributable to NSP-Wisconsin. Xcel Energy does not expect additional pension contributions during 2015.2016.

Changes in accumulated other comprehensive loss, net of tax, for the three and nine months ended Sept. 30,March 31, 2016 and 2015 and 2014 were as follows:

Reclassifications from accumulated other comprehensive loss for the three and nine months ended Sept. 30,March 31, 2016 and 2015 and 2014 were as follows: