The Minnesota Public Utilities Commission approved a two‑year rate increase for Xcel Energy in July, allowing the utility to collect an additional $210 million from ratepayers. The decision set the average residential bill up about $5.60 per month for 2025‑2026.
Consumer groups demand a review
Attorney General Keith Ellison and the consumer‑advocate group Citizens Utility Board have formally asked the commission to revisit the order. They contend the commission erred by permitting Xcel to earn a larger share of profits on infrastructure investments, specifically the proposed rise in the utility’s return on equity from 9.25% to 10.3%.
The commission ultimately set the return on equity at 9.6%, a figure the challengers say still inflates bills. They estimate the higher return will add roughly $34 million each year to Minnesota households, a burden that many families are already feeling after a record‑warm summer.
Why Xcel seeks higher returns
Xcel Energy argues that a competitive return on equity is necessary to attract investors for new projects that modernize the grid, replace aging infrastructure, maintain the state’s carbon‑free nuclear fleet, and connect additional renewable resources. The utility’s spokesperson, Megan Boldt, said the commission’s decision supports a “competitive return on investment, which is below the national average, and keeps bill increases at or below the rate of inflation.”
Utility representatives also note that the commission capped the company’s ability to recover executive compensation from ratepayers, waived late‑payment charges for low‑income customers, and established assistance programs for those struggling to pay.
Public sentiment and expert commentary
Analysis of roughly 4,000 public comments submitted to the commission shows overwhelming opposition to the increase. More than 8,500 comments were filed overall, with many residents citing the return‑on‑equity provision as a primary concern.
University of Minnesota professor Gabe Chan, who testified in the case, warned that inflationary pressures are driving up the cost of basic infrastructure such as wires, poles, and transformers. “People are very concerned about energy affordability, and people are struggling to pay their energy bills,” Chan said.
Potential outcomes
The commission has until October 19 to decide whether to take up the petitions. If it revises the order, the final rates for 2025 and 2026 could be lower than the currently approved 2.3% and 3.4% increases, potentially resulting in refunds for customers who were expecting higher bills.
Regardless of the outcome, the case highlights the importance of vigilant consumer advocacy in ensuring that utility regulation serves the public interest and protects family budgets.
Original reporting: Sahan Journal — read the source article.
