Xcel outlines its plans for savings from the federal tax cuts
Xcel Energy has outlined what it will do with the money it saved from federal tax cuts.
The North Dakota Public Service Commission held an informal hearing on the settlement reached by the utility and the PSC advocacy staff.
Xcel is proposing to return the $9.7 million it saved in 2018 from the tax cuts, that affected the 2017 tax year, to customers, in a refund.
"The impact to the typical residential customer is going to be about $46," said Xcel Senior Regulatory Consultant Dave Sederquist. "That's well over half of a typical electric bill."
The utility has also agreed not to file any rate increase requests before January 1, 2020.
"This extends the period the company has not increased rates to 5 years," Sederquist said.
Sederquist told the PSC the company will also lower its allowed “rate of return,” and will refund money earned over that cap in the next two years. But Xcel wants to keep the money it would have paid at the higher federal rate for those two years.
"My first goal was going to be, because the money isn't needed for taxes, to give it back to the ratepayers," PSC Commissioner Julie Fedorchak said after the hearing. But she also said it becomes a balancing act.
"There are some protections there (for consumers) that are significant," Fedorchak said. "I'm weighing that now."
In the settlement, the PSC would agree to give some non-North Dakota wind farms an "advanced determination of prudence," which would allow Xcel to add costs to its "renewable energy rider." Sederquist said if the PSC refuses to do that, the whole deal could collapse.
Since it was an informal hearing, the PSC didn’t act on the proposal. It will do so at a later date.