Minnesota regulators green-light energy price hikes

Minnesota Power asked regulators' permission to raise energy prices by 14.2%. They were approved for a 7.1% price hike. Similar price increases were also approved for other energy companies in the state.

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Minnesota residents can expect higher electric and energy bills in the not-so-distant future.

In two press releases, the Minnesota Public Utilities Commission announced that it has approved interim rate increases for Minnesota Power, CenterPoint Energy, and Xcel Energy, albeit at rates lower than what the companies had initially proposed.

Minnesota Power requested a 14.2% increase in prices for electric customers but received approval for a 7.1% increase. CenterPoint Energy sought a 5.1% increase in prices for natural gas customers but were approved to hike them by 3.9%.

Final decisions will be expected in the 2022 winter (Minnesota Power) and fall (CenterPoint) seasons.

As for Xcel Energy, they had proposed 9.4% and 4.9% increases in electric and natural gas prices respectively, but the Commission approved 6.4% and 3.9% interim increases instead. Rate hikes won’t take place for Xcel customers until the spring and summer of 2023.

“The Commission knows that rate increases have a big impact on ratepayer’s monthly budgets,” said Commissioner Joseph Sullivan. “We worked hard and successfully found creative solutions to mitigate the monthly increases that a customer will see.”

Final electric and energy prices could be higher than the approved interim prices, but according to the Commission, customers will be refunded if the final prices end up lower than the interim prices.

The increasing cost of energy stems from higher residential consumption due to the COVID-19 pandemic and the National Oceanic and Atmospheric Administration’s projection of a 5% colder winter than last year, according to a Cape Cod Times report.

The report also notes that the U.S. Energy Information Agency has predicted a 33% increase in heating oil prices nationwide this winter.