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Utility Bills to Rise Again with Xcel Energy Rate Hike

PHOTO: While electricity bills will soon be going up again for Xcel Energy customers in Minnesota, the rate hike is much less than the company was seeking. Photo credit: John Michaelson.
PHOTO: While electricity bills will soon be going up again for Xcel Energy customers in Minnesota, the rate hike is much less than the company was seeking. Photo credit: John Michaelson.
April 7, 2015

ST. PAUL, Minn. - The cost of electricity will be going up again for a large number of Minnesotans, but consumer groups are calling the rate hike a victory, as the increase is far less than what was originally requested by Xcel Energy.

State regulators recently approved the two-year rate hike, which is expected to result in an increase of 6.1 percent for Xcel Energy, or $168 million – about 40 percent lower than the original request.

Seth Boffeli with AARP Minnesota credits consumers who made their voices heard with reigning in the severity of the rate hike.

"Thousands and thousands of Minnesotans either wrote the Public Utilities Commission, came to a public hearing or signed a petition," says Boffeli. "The Public Utilities Commission listened. And I think it's really a testament to them. It's a testament to the system we have here in Minnesota where customers have a voice."

Xcel's 1.2 million Minnesota customers have been paying 4.6 percent more since January 2014 under an interim rate hike. Exactly how much more customers will have to pay under the recent approval remains unclear, as a determination has not yet been made on how the increase will be divided among residential and business customers.

In addition to the lower rate hike, Boffeli notes that regulators also rejected Xcel's request to increase the basic monthly charge that customers pay regardless of how much power they use.

"We think that's a really significant win for customers, because it gives you more control," he says. "If you want to lower your bill, you have the reins to do it. You can lower your usage, you can conserve more and you can see that impact."

As for 2016, Boffeli says Xcel Energy has been sending out mixed signals, telling investors it doesn't expect to seek another hike next year, while telling the Minnesota Public Utilities Commission it may need to come back because the just-approved rate hike was lower than requested.

John Michaelson, Public News Service - MN