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Xcel wants to increase electricity rates. Here's what happens next (and how you can comment)

At a 6:30 a.m. meeting, the Public Utilities Commission began examining an Xcel Energy rate case. Former commissioner Ron Lehr helped explain what goes into that.

DENVER — If a public meeting happens at 6:30 a.m., is it really public?

Xcel Energy wants to increase electric bills starting this fall. It is a process called a rate case.

There will be several hearings that happen between 6:30 a.m. Tuesday morning and this summer when the Colorado Public Utilities Commission (PUC) decides how high your rates can increase.

What is a rate case anyway?

On Nov. 30, Xcel filed a request to increase electric rates by $312 million. The rate increase would start in the fall.

According to Xcel, the average residential customer would see a rate increase of $7.33/mo., while a commercial customer would see an increase of $10.16/mo.

Rate cases happen about every two years, and they're kind of like a game of leapfrog.

A utility company seeks customers to pay it back for expenses it already invested in the previous year, while paying for future investments over the next year.

“What’s the right balance between reliability and cost? Between environmental protection and pollution? There’s a balance. We don’t go after perfection here. We’re trying to find a balance between competing values,” said former PUC Commissioner Ron Lehr.

Lehr, who was appointed to the PUC by Gov. Dick Lamm, has been off the PUC since 1991.

“You don’t want to pay a nickel more than you should, so you want the regulators to be on the job, making sure that the service is good, and in return, the payments are adequate to keep the service going,” Lehr said.

The hearing on Tuesday morning was about information sharing. The Office of Utility Consumer Advocate (UCA) – which is the public defender for ratepayers – is seeking the historical expenses and costs from Xcel, so the UCA can prepare an argument against the rate increase.

The UCA wanted the data and information by Mar. 10. Xcel said it would have the information on Mar. 29. The UCA filed a motion with the PUC to compel Xcel to turn the data over sooner. The hearing on Tuesday morning resulted in a deadline of Mar. 24, and if Xcel cannot meet that deadline, the UCA gets to extend its next deadline for every day Xcel has not provided the data.

“Where you sit depends on how you look at it. If you’re on the company side, ‘Oh my god, this is overbearing, we don’t have the information, it’s too much.’ On the intervenor side, ‘We need this information, we want to look into depth in terms of how you came up with these numbers and we ought to have that so that we can make our case,’” Lehr said.

He said that when he was PUC commissioner, he would punish attorneys for actions like this that may seem like delay tactics, or ways to get additional lawyer fees added. (Watch the story of how Lehr would make lawyers work from 7 a.m. and through the night until disputes like this were resolved.)

In a rate case, anyone can intervene to be heard by the PUC.

If you want to provide comments to the PUC about your thoughts on Xcel’s electric rate increase request, follow this link. Choose “Public Service Company of Colorado (or Xcel Energy),” and then select the second-to-last option “22AL-0530E - Filing to increase base rate revenues due to load growth and implement new base rates for all electric rate schedules.” That is the specific electric rate case that Xcel is seeking for this fall.

When Lehr was a commissioner, he said the commission would travel to areas where they received a number of complaints. He remembered one story at a retirement community, where the residents were arguing against a telephone rate increase. A woman listed off her expenses, ending with medicine, and showing the commission that she was in the negative for the month. She told the commission that she could not afford the rate increase. The way she presented her position stuck with Lehr.

In the case of this rate case, Walmart and Kroger, the parent company of King Soopers, are intervening because of their own positions.

"Rate cases makes their budget change, probably not in a good way, so yeah, they want to manage their bills by intervening and making sure they’re reasonable and rational,” Lehr said.

One of the interveners on behalf of Kroger is Justin Bieber.

No, not that one.

The Justin Bieber listed is an associate with Energy Strategies LLC., based in Salt Lake City.

When asked what research and data Xcel requires when requesting a rate increase, a spokesman provided the following statement:

“We file a rate case request when the costs of providing safe and reliable natural gas or electricity service exceeds what customers are currently paying in rates. These rates are set in a transparent process with the PUC, the body that regulates investor-owned electric utilities in the state, and the proceedings include opportunities for public input and participation along the way. 

We are required to provide detailed support for the request. The PUC then reviews the information, with public input from customers, business groups, cities and agencies, and other special interest organizations before making a decision. We have an educational YouTube video breaking down what a rate case is and why they’re required by the PUC, see linked here.

To support proactive investments to expand and strengthen the electric grid to meet our customers’ evolving energy needs, we submitted a rate proposal to the PUC on Nov. 30, 2022. It includes efforts to provide an increasingly clean energy mix and maintain and strengthen poles, wires and other infrastructure across the state. We’re making progress on our aim to provide 100% carbon-free electricity by 2050 and moving forward with high-value investments to meet Colorado’s energy needs. More information about the 2022 electric rate case is available on our website, linked here.

The result is a power grid that is better protected from increasing risks, including cyberattacks, wildfires and extreme weather. These investments also establish a technology platform for enhanced customer experiences, new products and programs – and a more reliable, resilient system to serve customers.

Even with the increase we are requesting in this case, Xcel Energy–Colorado’s average residential customer bills will remain below the national average. Those below-average bills do not happen by accident; maintaining affordable costs for customers is a priority for the company.”

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