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Published December 21 2010

Xcel Energy seeking rate increase

More than 88,000 Xcel Energy customers in North Dakota may see higher electric rates in the future – but a final decision won’t be made for many months.

Xcel on Monday asked the North Dakota Public Service Commission to consider a base electric rate increase of 12 percent for 2011 and an additional 2.5 percent for 2012.

If the PSC approves the request, that would mean a typical residential customer would be charged an extra $7.60 a month for an average use of 750 kilowatt-hours each month.

Laura McCarten, regional vice president of NSP-Minnesota, which owns Xcel, said the increase would bring in $24 million more for Xcel to fund infrastructure improvements during the next two years and make changes as a result of federal regulations and the economy.

“While we have worked to manage costs and increase our efficiency, we are not able to avoid this rate request,” McCarten said in a statement.

Rate increase requests don’t come before the commission very often, but when they do, Public Service Commissioner Brian Kalk said the end result is often a lower amount than what the utility originally requests.

“There’s no way to determine until we get into the hearing what’s fair and reasonable,” Kalk said. “Virtually never does what the company requests turn out to be the final amount, but that doesn’t mean that will happen this time, because there’s so much that goes into it.”

The request didn’t come as a surprise to Kalk, who said there’d been rumors recently of Xcel mulling a potential rate increase.

Xcel Energy paid a $125,000 filing fee to submit its request, Kalk said, adding that the fee pays for the commission’s costs in reviewing the matter.

Members of the public will have chances to comment on the potential increase when Xcel Energy and the PSC hold public-input sessions in the next several months.

The sessions will likely be held in Fargo, Grand Forks and Minot, Kalk said.

Then, the PSC will review the matter in formal hearings before making the final decision.

The three-person commission is charged with regulating gas and electric utilities, pipelines, coal mining and other entities.

The commission plans to discuss the request at its Dec. 30 meeting, Kalk said.

“We’re going to make sure that whatever amount they get is fair for everyone,” Kalk said.

Readers can reach Forum reporter Kristen Daum at (701) 241-5541