Recognizing Minnesota residents are "under financial distress," state regulators slashed a proposed Xcel Energy electric rate increase. Interim residential rates will still rise, but only about $5.50 a month instead of about $8.50.
The Minnesota Public Utilities Commission (PUC) on Thursday approved a total interim rate increase of $79.8 million, which was about $41 million less than what the utility had requested, for residential customers. It also approved an interim increase for natural gas customers.
"The commission is very concerned about affordability for consumers, and they're asking all the right questions," said Annie Levenson-Falk, executive director of the Citizens Utility Board of Minnesota, an advocacy group for residential ratepayers.
For Xcel, which provides power to 1.3 million Minnesota customers, that number is a "substantial cut," the utility's attorney, Matt Harris, told the commission.
It likely means Xcel, the state's largest electricity provider, will come back next year to ask for another interim rate increase for 2023 as the full review of Xcel's request plays out. The utility wants to raise rates by $677.4 million over the next three years — a 19% increase for residential customers — to pay for infrastructure investments.
The interim rate increase approved Thursday is a 6.4% bump for residential bills that will go into effect Jan. 1 while the rate case is adjudicated, a process that typically takes about 18 months.
"Our electric rate proposal enables us to deliver a better product for our customers, maintaining and enhancing our infrastructure to ensure reliable service while supporting our efforts to give customers more of what they want — cleaner energy, more ways to manage their energy use, and bills that stay low now and over the long-term," company spokesman Matt Lindstrom said.
Xcel's gas customers will be paying for last winter's extreme spike in gas prices for years to come after the PUC extended the amount of time Xcel Energy can recoup those costs.
