Colorado utility commission approves Xcel Energy rate hikes

Monthly rates for Xcel residential customers will rise by more than 1 percent, or 96 cents on the average customer’s bill, this year and less than 1 percent, or 72 cents on the average bill, next year under a settlement with the Colorado Public Utilities Commission.

Rates will decrease by a fraction of 1 percent, or 11 cents on the average bill, in 2017. Rates for commercial customers would reflect similar percentage changes.

The utilities commission approved Tuesday the settlement agreement that will increase electric rates for Xcel Energy customers to pay for clean air improvements.

The settlement, reached between the company, utilities commission staff members and other parties, calls for a net revenue increase of about $41.5 million annually, a significant decrease from the $137.7 million originally proposed by the company.

Xcel’s base electric rates will decrease by about $39.4 million per year, but a Clean Air-Clean Jobs Act rider will be added to customer bills as investments are completed in 2015 and 2016, resulting in the overall net increase. Lawmakers passed the legislation in 2010 to require utilities to reduce emissions.

In approving the settlement, the utilities commission established a 9.83 percent return on equity for the company, down from Xcel’s current 10 percent. Return on equity is the amount that a utility is authorized to earn on its investment, in order to attract the capital needed to ensure safe and reliable service at reasonable cost for customers.

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