AARP report shows Xcel proposed rates hurt low income consumers

Even with the settlement, residential consumers – including the most vulnerable – would pay more ~

AARP Colorado strongly supports the transition to renewable energy. However, the nonprofit, nonpartisan organization that advocates on behalf of older adults and their families, is extremely concerned that residential ratepayers, who can least afford it, are being asked to absorb an unfair percentage of the costs.

Public Hearing 

The Public Utilities Commission will consider a proposed settlement by the parties, beginning January 18 in this current rate case. In addition, the PUC has set a remote public meeting to hear from the public on January 19, 4-6 p.m. Consumers can participate by Zoom at https://us06web.zoom.us/j/89309441170?pwd=Y1BRaG1na3hTWjJUMmFFWTRoMHU3dz09  

Meeting ID: 893 0944 1170, Passcode: 643247 

AARP submitted its report in Xcel’s current electric rate case, outlining the reasons for its concerns about the impact on low-income residential customers and those on fixed incomes. Email acortez@aarp.org if you want a copy of the white paper. 

In its rate case, Public Utilities Commission proceeding no. 21AL-0317E, Xcel originally asked the PUC to approve a nearly 13 percent increase in residential base rates. That percentage increase has been cut in half in a proposed settlement to 6.44 percent, but residential consumers would still bear the highest percentage rate increase of any service class. 

Additional Increases  

These proposed settlement rate increases are in addition to the separate charge for natural gas, which spiked in the fourth quarter of 2021, as well as numerous other bill surcharges, including one as a result of the abnormal cold spell last February. Several of the rate hikes are due to legislation passed by the Colorado Legislature. 

In 2019 and 2021 the Colorado Legislature passed laws to reimburse Xcel and Black Hills Energy for closing their fossil fuel plants early by adding numerous surcharges on customer bills. This permits the state’s two regulated electric utilities to pass costs only onto its ratepayers and not its shareholders. The result is that the monopoly electric providers are hitting residential ratepayers with pancaking layers of rate hikes. 

AARP’s paper written by Bill Levis, former Colorado Consumer Counsel, highlights Xcel’s testimony that the usage of commercial and industrial customers is decreasing in comparison to that of residential customers. Of Xcel’s 1.5 million customers in metro Denver and Grand Junction, 90 percent are residential users. 

Unfair Burden 

The shift in the ratepayer pool is putting an even greater burden on those who are low income or on a fixed income. Many of AARP Colorado’s 670,000 members who are 50 or older are in those income categories, especially those relying solely on social security or PERA benefits. 

Many commercial and industrial customers are converting to solar, lessening their dependence on electric power companies. Additionally, residential customers who can afford it are installing solar panels to decrease their utility costs, especially since the Colorado Legislature removed the 120 percent cap on reimbursement. This leaves those who can least afford it to make up the difference for the utility companies. 

 

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