In recognition of the recent success of gas price hikes, Xcel Energy-Colorado plans to file for an electric rate hike, possibly before the end of the year.
The Colorado Public Utilities Commission issued a decision Tuesday approving a $64.2 million increase in natural gas rates. Monthly residential rates will increase by 2.9%, or $2.09, and small business rates will increase by 3.1%, or $12.95 per month.
Higher rates will kick in on November 1st.
Xcel Energy’s new filing shows the company is proposing to raise electricity rates — again. A $182.2 million increase in Xcel’s electric rates went into effect on April 1, increasing residential monthly bills by 6.44% and small business bills by 6.24%.
Xcel Energy said in a recent filing to track the state of the electric rate that the company “finds itself seeking an increase in base income in the fourth quarter of 2022.”
Xcel is the largest electric utility in Colorado. Critics have referred to the rising rates as “pancaking” inflation.
“This will be another layer in the stack of pancakes,” said Joe Pereira, deputy director of the Colorado Office of the Utility Consumer Advocate.
If submitted, the price request would be Xcel Energy’s fifth lawsuit in four years, Pereira said.
Xcel Energy did not respond to a request for comment. During the new natural gas rate shutdown, the utility said its latest price requests are based on the cost of current projects and investments to meet the future needs of its growing customer base.
AARP Colorado praised the PUC for cutting Xcel Energy’s first proposed gas bill by $138 million to $64.2 million.
“Although AARP Colorado is fighting for a complete rejection of Xcel Energy’s proposed rate hike, we think the lower rate is a big win for all Colorado consumers,” AARP spokeswoman Angela Cortez said in a statement.
However, Cortez said in an email that if Xcel is seeking an electric rate increase on the heels of a gas hike, “we think it’s ridiculous.”
“It’s clearly ‘pancaking,’ filing rate increases after another, and Coloradans are sick of it,” Cortez said.
Rising natural gas prices are driving many utilities to raise their prices. Xcel Energy said in September that prices reached a 15-year high. The administration has approved a fuel price adjustment that went into effect on October 1. The company passes the fuel price increase on to its customers and makes no money from them.
But the newly approved price increase becomes part of the company’s base income going forward. Pereira said the consumer advocate’s office does not know the size of the additional revenue increase Xcel Energy plans to seek, but expects it to be significant.
“We’ve had a parade of overdrafts as challenging as most consumers can remember,” Pereira said. “We hear from customers every day that the challenges of paying gas and electricity bills are increasing with no relief in sight.”
On the other hand, Xcel Energy has “several years of banner,” Pereira said. Federal records show that Xcel Energy will make $660 million in revenue in Colorado in 2021, up from $588 million in 2020 and $578 million in 2019.
Energy Outreach Colorado, which helps low-income energy customers, is preparing for another busy winter, said Denise Stepto, a spokeswoman for the nonprofit.
People were hit hard by inflation and are still recovering from the economic downturn associated with the pandemic, Stepto said.
“Last winter was an expensive energy winter and we’re looking at the same forecast this coming winter,” Stepto said.
The US Energy Information Administration expects homes that use natural gas for heating to see costs jump by 28% this winter. Propane and electricity costs will also increase due to higher fuel costs and colder temperatures, according to the agency.
Calls to the state’s heat helpline are up about 26% this October compared to October 2021, Stepto said. “People are now starting to open their own centers.”
Access to Energy has helped 23,293 households so far this year. The organization was started by the Colorado General Assembly in 1989. In 2021, lawmakers agreed to add a 75-cent fee to investor-owned gas and electric bills to help low-income customers.
People can contact the heat help line, 1-866-HEAT-HELP or 1-866-432-8435, for help. Assistance from the Colorado Low Income Energy Assistance Program – LEAP – is available.
Energy Outreach provides information on the best times to use certain appliances and monitor energy use to reduce bills.