Xcel Energy has announced an increase in billing to begin in October.

The energy company announced that an agreement had been reached between themselves, Public Utility Commission staff and certain customer groups that will allow Xcel to raise its retail revenues in Texas by 3.5 percent annually.

The October rate hike will allow Xcel to earn an additional $37 million annually, but is lower than their originally sought raise of $52.7 million annually.

At the individual level, homes billed for the typical 1,000 kilowatt-hour will expect to see a six percent increase on bills beginning in October at a typical rise of $6.58 per month.

Xcel Energy
Xcel Energy
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Pending a final order to be issued by the Public Utility Commission, the rates will be collected on an interim basis and Xcel has also announced their intention to retroactively charge for the new rate ranging back to June, 2014. Xcel has said they will file a temporary surcharge in the fall to recover their perceived losses.

Xcel also levied for the authority to add another surcharge to Texan’s bills to recover past under-collections of fuel costs. If approved, the typical 1,000 kilowatt-hour home will see a $2.70 increase per month from November, 2013 through April, 2014.

“These two increases are unrelated, but necessary changes to allow us to recover the higher costs of capital investment and fuel,” said David Hudson, president and CEO of Southwestern Public Service Company, an Xcel Energy company. “The fuel cost surcharge is temporary, but the base rate increase is to pay for increased costs associated with investment in the regional power grid.”

Xcel, in their final recent announcement, spoke about an ongoing capital expansion project slated for $3.2 billion in investments. The project will improve infrastructure in Texas and New Mexico with new power lines, substations and power generating facilities. The Texas-New Mexico Capital Expansion project began in 2010 and is expected to be completed by 2019.

Xcel currently provides electric services to at least 80 Texas municipalities.

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