ST. PAUL, Minn. (AP) — Xcel Energy Inc. is seeking permission to raise Minnesota electricity rates by 4.6 percent and 5.6 percent the next two years, saying the money is needed for a big push in infrastructure investment.
Those hikes would amount to about $291 million, but the Minnesota Public Utilities Commission has typically cut Xcel's rate increase requests in half in recent years. If granted in full, the increases would add about $10 on average to a customer's monthly bill.
Xcel has 1.2 million customers in Minnesota.
Xcel regional vice president Laura McCarten said the increases will help pay for new wind investments and upgrades to Xcel's Monticello and Prairie Island nuclear plants, which supply 30 percent of Xcel's power.
She said the increases represent the top of an investment cycle Xcel needs to complete to maintain high-quality service.
"Over the next couple of years we expect to be moving out of that, but right now we are making these investments; they are part of the drivers for cost increases," McCarten said. "That's why this request also includes a proposal to moderate or reduce prices to customers than what they otherwise would be and provide predictable prices over the next few years."
The company is eying additional rate hike requests from 2016 to 2018, but lower than those proposed this week.
Bill Blazar, senior vice president for public affairs at the Minnesota Chamber of Commerce, said spreading out the increases helps. But he said he was concerned that higher commercial-industrial rates could hurt business development.
Pam Marshall, executive director of the nonprofit Energy CENTS Coalition, which advocates for low-income utility customers, said the increases would hurt. She said only a small share of low-income customers get help with their bills from the government or the utility.
"You have people who are already devoting a significant percentage of their household income to pay the electric bill and who are now going to be expected to absorb multiple increases over several years," Marshall said.