Xcel Halves Electric Rate Hike for North Dakota Customers
Xcel Energy has revised its proposed electricity rate increase for customers in North Dakota. The new plan, pending approval, aims for a more manageable overall increase of 10.37% for all customers, with residential rates seeing a slightly higher increase of 12.92%.
Xcel Energy’s Proposal Overview
Initially, Northern States Power Co., a division of Xcel Energy based in Minnesota, sought a more substantial increase of 19.34%. Residential customers were facing potential hikes exceeding 24%. However, following a recent Public Service Commission (PSC) hearing, the company has significantly reduced its request.
Hearing Details
- The PSC hearing focused on the details of the rate increase and the terms of the new agreement.
- Slight changes in customer bills are expected if the proposal is approved, according to Victor Schock, director of utilities for the PSC.
- A decision by the three-member commission is anticipated in January.
Context of the Rate Increase
This is the first rate hike request from Xcel Energy in four years. The company’s representatives indicated that the adjustment is necessary to offset rising inflation and to support infrastructure projects, including a new service center in Grand Forks and upgrades to existing substations and equipment.
Customer Impact
Xcel serves approximately 97,000 customers across North Dakota, including major cities like Fargo, Grand Forks, and Minot. During the PSC hearing, Public Service Commissioner Sheri Haugen-Hoffart highlighted several themes from public comments regarding the proposed rate increase.
- Data Centers: Vice President of State Regulatory Policy Allen Krug clarified that the rate adjustments are unrelated to the operations of data centers in North Dakota or Minnesota.
- Impact on Vulnerable Groups: The increase may disproportionately affect seniors and those on fixed incomes who rely on Social Security cost-of-living adjustments.
- Minnesota Policy Impact: Changes in Minnesota’s energy policies, especially regarding fossil fuels, do not directly drive the proposed increases in North Dakota.
- Company Profits: Krug reassured stakeholders that Xcel’s profits align with investor expectations, indicating financial health despite recent challenges.
Infrastructure Investment
In addition to maintaining service reliability, Xcel Energy plans to enhance its natural gas infrastructure. There is potential for a new natural gas-powered plant in eastern North Dakota, contingent on pipeline developments from the state’s oilfields.
The PSC hearing, initially scheduled to last a week, concluded earlier than anticipated due to the reached compromise. Approval of this new rate increase proposal will help balance consumer needs and necessary investment in reliable energy infrastructure.
