News Releases

Xcel Energy requests 5.9 percent rate increase for Texas retail customers

Company seeks to lower fuel costs and fund system improvements

AMARILLO, TEXAS - Lowering fuel costs through efficiency improvements, while providing capital to build for future economic prosperity, are the goals of a proposed rate increase by Xcel Energy’s Southwestern Public Service Company.

“We’re in the middle of a historic growth cycle,” said David Eves, president and CEO of Southwestern Public Service Company, an Xcel Energy company. “We must meet the needs of a growing economy, increasing electrical demands, a burgeoning wind power industry and, at the same time, build efficiencies into our traditional generating and transmission resources. These are efforts designed to bring down high fuel costs.”

Responding to these changes, the company today filed a proposal with the Public Utility Commission of Texas and area municipalities served by the company for an overall increase in annual revenues of approximately $61.3 million, or a 5.9 percent increase. Base revenues are proposed to increase by $94.4 million, while fuel and purchased power revenue will decline by $33.1 million primarily due to the fuel savings from the Lea Power Partners’ Hobbs Generating Station near Hobbs, N.M. Xcel Energy will purchase the output of the new plant once it comes online later this summer.

Individual classes of customers will see varying changes in rates. Residential customers, for example, will see a 10 percent overall rate increase after fuel costs savings are counted, or approximately $10.33 per month on an average 1,000 kilowatt-hour bill. 

Today’s filing also involves a request to implement interim rates when the Hobbs Generating Station comes online. This will help recover costs of purchasing this power until the full rate case is decided. If this component of the filing is approved, the interim rates will actually lower bills for many customers, reflecting fuel cost savings that are larger than the fixed costs related to the purchased power.

Base rates would only rise after a review by the Public Utility Commission of Texas and the municipalities served by Xcel Energy in Texas – a process that could take up to six months. Even if higher rates are approved, Xcel Energy bills should remain among the lowest in Texas, and below the national average as well, Eves said.

“The service territory is growing and needs additional electrical generation and power lines to serve increased electricity demand from customers. The cost of new facilities has increased faster than our revenue growth from these additional sales.  Therefore, we must seek an increase in prices to cover these costs. The health of our company and our communities are tied together like no other time in the past, and we must work together to invest in a stable energy future,” Eves said.

Xcel Energy (NYSE: XEL) is a major U.S. electricity and natural gas company with regulated operations in eight Western and Midwestern states. Xcel Energy provides a comprehensive portfolio of energy-related products and services to 3.3 million electricity customers and 1.8 million natural gas customers through its regulated operating companies. Company headquarters are located in Minneapolis.

This news release includes forward-looking statements that are subject to certain risks, uncertainties and assumptions. Such forward-looking statements are intended to be identified in this document by the words “anticipate,” “estimate,” “expect,” “projected,” “objective,” “outlook,” “possible,” “potential” and similar expressions. Actual results may vary materially. Factors that could cause actual results to differ materially include, but are not limited to: general economic conditions, including their impact on capital expenditures; business conditions in the energy industry; competitive factors; unusual weather; changes in federal or state legislation; regulation; risks associated with the California power market; currency translation and transaction adjustments; the higher degree of risk associated with Xcel Energy’s non-regulated businesses compared with Xcel Energy’s regulated business; and the other risk factors listed from time to time by Xcel Energy in reports filed with the Securities and Exchange Commission.