FOR IMMEDIATE RELEASE: Tuesday, June 26, 2012
CONTACT: Leah Mohr, deputy executive director, South Dakota Public Utilities Commission, (605) 773-3201 or (605) 280-4327
PUC reduces Xcel Energy rate increase request
PIERRE, S.D. – The South Dakota Public Utilities Commission today approved a reduced rate increase of 5.12 percent for Xcel Energy. The company sought an increase of 9.28 percent, or $14.6 million in additional annual revenue. The commission's decision trimmed more than $6.5 million in additional annual revenue from Xcel Energy's initial request. The rate will become effective Aug. 1, 2012.
The PUC's action came during an ad hoc commission meeting in Pierre, S.D., on June 26, 2012. A partial settlement agreement was approved by the commission at a meeting on May 22. A formal hearing on the rate increase was held in Pierre, June 13-14.
"Rate increase requests are among the most difficult processes the PUC deals with," said Chairman Chris Nelson. "The final rate represents a significant reduction from the original request and reflects the diligence of the PUC staff to hold the rate increase to the lowest level possible for consumers while allowing Xcel adequate return to meet its needs," he said.
Xcel Energy implemented an interim rate increase of 8.09 percent in January 2012, as allowed by state law. The company will submit to the PUC a plan to refund to customers the difference between the interim rate and the final approved rate. The interim rate and corresponding refund period is from January 2012 through July 2012.
Vice Chairman Kristie Fiegen discussed the path that led to the PUC's final decision. "Xcel presented a substantial amount of information and testimony. The PUC staff, accordingly, delved deep into the data, carefully analyzed the company's request and the impact to ratepayers. In the end, we made a reasoned decision that follows the law and protects consumers' pocketbooks. We will continue to monitor the refund process to ensure ratepayers receive the appropriate difference between the interim rate and the final rate in a timely manner," she stated.
Commissioner Gary Hanson commended the PUC staff and Xcel Energy representatives for their efforts. "I appreciate the work both sides did during many months. There was give and take and, I'm sure, some intense discussion at times. I believe the final rate was indeed the appropriate decision for the ratepayers and the company," he concluded.
A PUC staff team comprised of five analysts and two attorneys were supported by two consulting groups in analyzing the rate request. The PUC staff engaged in negotiations with Xcel Energy representatives, making formal requests for additional information and holding meetings and discussions.
No individuals or organizations formally intervened in the case. The PUC received eight written comments from consumers about the rate case.
Visit the South Dakota Public Utilities Commission docket EL11-019 online for more information about Xcel Energy's rate increase request.