Xcel Energy has asked the Minnesota Public Utilities Commission to approve a two-year rate plan to increase rates. For 2025, the company is proposing a $353.3 million increase, or 9.6%. For 2026, they are asking for an additional $137.5 million, or 3.6%. Altogether, the total requested increase over two years is $490.7 million, or 13.2%.
Xcel Energy previously submitted a rate increase request in 2021.
Interim rates
As part of a rate-case review, utilities are entitled under Minnesota law to recover a portion of their proposed costs through interim rates while the PUC conducts a comprehensive evaluation of the full rate request.
The Commission approved a $192 million interim rate, or 5.2%, which is less than the $223.7 million Xcel Energy requested. These interim rates will take effect on January 1, 2025, resulting in adjustments to monthly energy bills for residential and business customers. Importantly, these rates are subject to refund with interest if the final approved rates are lower than the interim levels.
Electric customers pay four types of charges:
1-Monthly service charge
2-Energy charge
3-Fuel Charge
4-Taxes
The reasons identified by the utility for this proposed rate increase include:
- Modernization of the transmission and distribution system
- Investments in cleaner electricity generation
- Lower sales
- Higher returns for investors
