Public Utilities Commission halves electricity rate hike for Xcel Energy customers
State regulators have approved an electric rate increase for Xcel Energy customers less than half of what the utility originally wanted to charge.
The Minnesota Public Utilities Commission said it approved a 9.6% three-year rate increase Thursday after negotiating down from Xcel’s original proposal: a 21.2% hike from 2022-24. The difference amounts to more than $370 million in savings for Minnesotans.
“This Commission is laser focused on affordability and reliability. We scrutinize every dollar to ensure Minnesotans only pay what is necessary,” PUC Chair Katie Sieben said in a statement.
In response, Xcel said it is reevaluating its planned investments in the state’s energy infrastructure, starting with withdrawing a $170 million proposal to expand access to electric vehicle charging stations throughout Minnesota.
“We are extremely disappointed with the Commission’s decision, which will limit our ability to continue to lead the clean energy transition for our customers, and we will seek reconsideration of the decision,” Xcel spokesman Theo Keith wrote in a statement. “Today’s decision will require us to evaluate our planned investments in a cleaner, more reliable system for our customers to determine which investments we are able to continue to make.”
The PUC approved a $92 million rate increase for 2022, $93 million for 2023, and $121 million for 2024 — a three-year total of $306 million.
The final rate increase is less than the interim rate Xcel set in 2021, so customers will be entitled to a refund, according to the PUC. Xcel won’t be able to file a new rate increase until Nov. 1, 2024.
The PUC also required Xcel to establish a separate rate for low-income households and reduce the monthly basic charge for residences and small businesses.
Xcel won a 9.25% return on equity but will not recoup “excessive costs” for paying executives.