Xcel Energy's quarterly profit boosted by rate hikes, rising power demand

July 31 (Reuters) - U.S. utility Xcel Energy XEL.O on Thursday reported a 47% rise in second-quarter profit, helped by higher revenue through rate hikes, even as rising interest, depreciation and operations costs partially offset the gains.

Xcel was able to bring in more revenue through regulator-approved rate hikes in the quarter, helping it cover the costs of upgrading the grid, building new power sources and funding other major projects.

Utilities have been adding billions of dollars to their capital expenditure budgets as they field massive requests for new power capacity from new data centers needed for artificial intelligence technologies.

CEO Bob Frenzel said Xcel made "considerable progress" during the quarter on investments to strengthen system reliability and serve "unprecedented growth in electric demand."

"In Texas and New Mexico, we filed our recommended portfolio for nearly 5,200 MW of new generation, of which 4,500 MW will be company owned," Frenzel said.

For the reported quarter, Xcel's total operating expenses rose around 5% from a year ago to $2.71 billion, while total interest charges and financing costs jumped 6.3% from a year ago to $322 million.

Xcel reported a quarterly profit of $444 million, or 75 cents per share, for the three months ending June 30, higher than $302 million, or 54 cents per share, it reported last year.