Electric transmission lines cross a field in central North Dakota. (Photo by Jeff Beach/North Dakota Monitor)
Xcel Energy customers in North Dakota are facing an unusually large increase in their electric bill, which a North Dakota official attributes in large part to the company’s move away from coal.
Northern States Power Co., part of Minnesota-based Xcel Energy, has asked the North Dakota Public Service Commission to approve a rate increase of more than 19%. Customers will have a chance to sound off with utility regulators next week.
If the PSC approves the full increase, an average NSP residential customer would pay an extra $22.34 per month over last year’s rate. NSP customers have already seen an interim rate increase this year while the rate case is pending. The increase was nearly 12%, or $11.36 per average residential customer.
Victor Schock, director of utilities for the PSC, said it would be unusual for the three-person commission to approve such a large rate increase request in full. What is more likely is a negotiated compromise, he said.
Xcel has about 97,000 customers in North Dakota, including in West Fargo, Grand Forks and Minot. The proposed increase would increase Xcel’s annual revenue in North Dakota by $44.6 million.
Xcel says that since its last rate increase four years ago, it has invested in North Dakota projects, such as a new Grand Forks service center, a new substation and equipment upgrades.
Schock said the increase is driven by infrastructure upgrades, but also by Xcel’s move away from coal-fired electricity.
Xcel last year retired one of three coal units at the Sherburne County Generating Plant, or Sherco, near Monticello, Minnesota. It plans to retire Sherco’s remaining coal-fired units in 2026 and 2030, marking the company’s full exit from coal
Xcel instead will use the site for what it calls the largest solar facility in the Midwest and a battery storage facility.
Schock said Minnesota public policy, which tends to favor green energy much more than North Dakota policy, is a driver behind the change.
“We’re close geographically; policy wise, we’re pretty different,” Schock said.
He said North Dakota views the Sherco coal facility as an asset that should keep producing coal instead of one that should be retired with costs passed on to North Dakota customers.
“That is, in my opinion, one thing that is driving their large requested increase,” Schock said.
Xcel says its North Dakota residential customers’ electric bills were about 28% below the national average from 2019 to 2023, and it anticipates bills will stay well below that average, in part because of federal tax credits for nuclear energy plants.
Xcel representatives on Oct. 13 will make two presentations on the rate increase, at noon and 6 p.m. in the state Capitol. Public comments will be taken after the presentations.
The hearing can be seen online through the PSC’s website.
People can watch the hearing and provide in-person comments at the Capitol or these locations:
Grand Forks: The Chamber Grand Forks, Chamber Board Room, 202 N. Third St.
Fargo: North Dakota State College of Science Dr. Jerry C. Olson Auditorium, 1305 19th Ave. N.
Minot: City Hall, City Council Chambers, 10 3rd Ave SW.
Comments also may be submitted via email to ndpsc@nd.gov or by mail to: Public Service Commission, 600 E. Boulevard Ave., Dept. 408, Bismarck, ND 58505.
The meeting can be heard by telephone at 1-888-585-9008, room code 671-872-185. Public comments also can be made by phone.
The PSC has set aside a full week for a formal hearing beginning Dec. 1, but if a settlement agreement is reached before that hearing, it would likely not take that long, Schock said.
Reach North Dakota Monitor Deputy Editor Jeff Beach at jbeach@northdakotamonitor.com.
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