Xcel electricity and gas rates increased on January 1, with final rate hikes pending

Published January 7, 2022

If you receive natural gas or electricity service from Xcel Energy, you’ll notice an interim rate increase on your next bill. Before the holidays, the Minnesota Public Utilities Commission (PUC) approved the increases, beginning January 1, but at substantially lower amounts than Xcel initially requested.

An interim rate hike is a standard step after a utility has requested a general rate increase, as Xcel has done for both its electricity and natural gas service. Interim rates go in place as a full rate increase request is being considered, which requires a legal proceeding that generally takes 12-18 months. If final rates are lower than the interim rate increase, customers receive refunds with interest. 

Xcel’s residential electricity rates will increase by 6.4% during 2022, which is about $5.50 per month for the average household. Xcel had asked for a 9.7% interim increase, but the PUC reduced this request, finding that residential customers face “exigent circumstances” in the current economy. In other words, the PUC understands the special pressures many customers are facing right now due to COVID and its effects on the economy.

The PUC also approved an interim rate increase of 4.9% for Xcel gas. At the same time, to reduce the bill impact to customers, the PUC decided to extend customer charges to repay the cost of the February gas price spike over 63 months, rather than 27 months as previously set. In 2022, the net result for residential customers will be a rate increase of 1.0%, or about $0.60 for the average customer. 

CUB understands the impacts of rising energy costs to Minnesota consumers, and we’re fighting back against utilities’ high rate hike requests. CUB will be intervening in Xcel’s electric rate case (and Minnesota Power’s as well), and we are recommending the PUC deny more than $220 million of utilities’ spending on gas last February in a separate case. (More on that case in this blog soon.) We’ll share updates as the cases progress.

In the meantime, here are some resources that can help with utility bills.

  • Energy Assistance provides grants toward past-due and future energy costs. If you qualify for Energy Assistance, you can also have future utility bills capped at a certain portion of your income through affordability programs offered by some utilities, including Xcel Energy.  
  • Weatherization Assistance and low-income conservation programs provided through the utility offer free or low-cost efficiency improvements and appliances to qualifying households. 
  • All customers can get rebates and discounts on energy efficiency measures through the utility. 
  • Check out CUB’s efficiency tips to save money.

If you have questions, concerns, or would just like to talk with someone to see if there are ways to reduce how much you spend on energy costs, contact us: 651-300-4701 or info@cubminnesota.org.

How useful was this post?

We are sorry that this post was not useful for you!

Let us improve this post!

Tell us how we can improve this post?

Author: Annie Levenson-Falk

7 Responses to "Xcel electricity and gas rates increased on January 1, with final rate hikes pending"

  1. Susan Posted on February 6, 2022 at 1:00 am

    I did not like to pay $266.03 for my Excel bill….I live in a studio and have a small heater to heat my Studio apartment.
    I paid this amount when I lived in 2 bedrom house, with full basement, kitchen, LR, Bath & 1/2…

    This is absoulety ridiculous to pay this amont, plus Covid, no jobs, ppl R leaving jobs.

    I am 74 yearws young, & I do not want to pay this amount again.

    Thank you for listening to me

  2. FV Posted on February 8, 2022 at 3:41 am

    Hi Susan, I just paid my February bill and it’s the most I’ve paid since living in my home, and I’ve got all the ‘energy’ upgrades for efficiency. What this tells me is that Xcel is not a good steward. While I realize aging equipment may be at play, it always has been and so not a special event. What we need is reliable, consistent energy, where even Europe acknowledges its usefulness, I.e nuclear and natural gas. Solar and wind is what you are seeing in your bill. Time to make your voice heard. Drive by any wind farm and count the units not running, or the clouds in the sky, these forms are not efficient and have a tremendous cost to society, which you can feel in your pocket book.

  3. Brian Tang Posted on February 28, 2022 at 12:07 pm

    I keep hearing about how much the price of renewable energy has dropped over the past decade and that solar and wind are now cheaper per KW than any other type of power plant. As renewables make up a greater share of energy generation, shouldn’t per-unit costs to Xcel be decreasing over time? Why are electricity rates going up at all?

  4. Dave Hubbard Posted on March 21, 2022 at 1:11 pm

    My February bill went from $108 to $220 using less energy than the month before what gives?

  5. Annie Levenson-Falk Posted on March 21, 2022 at 1:45 pm

    Susan, that is really high. We could look at the bill with you and try to help you get it down if you’d like. You can contact us at info@cubminnesota.org or 651-300-4701.

  6. Annie Levenson-Falk Posted on March 21, 2022 at 1:46 pm

    There are multiple things going on with heating bills right now. #1 by far is that the cost of natural gas (and all fuels) has gone way up.

    Additionally, Xcel and CenterPoint both have “interim rate increases” on bills — temporary increases while their full base rate increase is being considered by the Public Utilities Commission (a separate line item on the bill).

    And on top of that, there’s the extra charge to pay off the huge costs incurred during the Feb. 2021 price spike (also a separate line item).

    Assistance is available: https://cubminnesota.org/shutoff/

    And one thing we do at CUB is help people reduce their bills. Contact us any time: info@cubminnesota.org, 651-300-4701.

  7. Jim Engen Posted on April 6, 2022 at 5:40 pm

    My December natural gas cost rose 90% from last year. January was over a 100% increase. Electric was roughly 17% increase. How can Xcel legally double the cost? Especially here in the middle of winter. Ridiculous!

Leave a Reply