Xcel Energy proposes $45.7 million credit to electric customers One-year reduction the result of successful and effective Colorado multi-year rate plan
As a result of a previously approved multi-year rate plan, which has provided long-term price predictability for Colorado consumers and Xcel Energy, the company filed for a one-year reduction of $45.7 million in electric rates.
If approved by the Colorado Public Utilities Commission (CPUC), the reduction would become effective for a one-year period, beginning Aug. 1, 2014. Customers in Colorado would see a 1.5 percent reduction in customer bills, or a $1.17 credit per month for typical residential customers and a $2.33 credit per month for typical small-business customers.
This credit to our Colorado electricity customers demonstrates the benefits of multiple-year rate plans by providing incentives for the company to manage its costs, and by establishing customer protections that allow them to share in our success when we exceed our financial targets, said David Eves, president and CEO of Public Service Co. of Colorado, an Xcel Energy company.
We have achieved lower than previously projected cost increases, along with higher than projected customer growth. Together, these will result in the one-year credit to our customers, Eves added. At the same time, we have maintained or improved service levels in Colorado, while consistently providing safe, reliable and increasingly clean energy at a competitive price.
The reduction in Colorado electricity rates announced by Xcel Energy stems from a three-year electric rate plan that was negotiated with multiple parties representing Colorado consumers, and approved by the CPUC in April 2012.
The multi-year rate plan provided for step increases in base electric rates in May 2012, January 2013 and January 2014, along with a sharing mechanism to provide refunds to customers if certain financial targets are exceeded.
The company noted that it will file for future electric rate increases in Colorado in 2015 and beyond, to reflect the full impact of the completion of infrastructure investments, including the estimated $1 billion investment in the Colorado Clean-Air Clean Jobs Act; recovery of current levels of property tax expense paid by the company to state and local jurisdictions; and other cost changes.
Even with these significant investments, we believe the cost controls we have been able to achieve will continue to reduce the magnitude of these future increases, Eves said. Xcel Energy believes that the value of multi-year rate making has been clearly demonstrated, because it provides benefits for both the company and its customers. It is our hope that we will be able to continue with multi-year ratemaking in future years.
As noted, the one-year credit is subject to review by the CPUC staff and other parties to the 2012 negotiated settlement, as well as being subject to CPUC approval.
Xcel Energy (NYSE: XEL) is a major U.S. electricity and natural gas company with regulated operations in eight Western and Midwestern states. Xcel Energy provides a comprehensive portfolio of energy-related products and services to 3.4 million electricity customers and 1.9 million natural gas customers through its regulated operating companies. Company headquarters are located in Minneapolis.
This news release includes forward-looking statements relating to increased costs associated with expected higher commodity prices that are subject to certain risks, uncertainties and assumptions. Actual results may vary materially.
Forward-looking statements speak only as of the date they are made, and we do not undertake any obligation to update them to reflect changes that occur after that date. Factors that could cause actual results to differ materially include, but are not limited to, those risk factors listed from time to time by Xcel Energy in reports filed with the Securities and Exchange Commission (SEC), including Risk Factors in Item 1A and Exhibit 99.01 of Xcel Energy’s Annual Report on Form 10-K for the year ended Dec. 31, 2008.
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