North Dakota approves Xcel electricity rate increase

BISMARCK, N.D. (North Dakota Monitor) — Utility regulators on Thursday approved a compromise electricity rate increase for North Dakota customers of Xcel Energy, a deal they say shields those rate-payers from subsidizing renewable energy projects in Minnesota.

Northern States Power Co., part of Minnesota-based Xcel Energy, in 2024 asked the North Dakota Public Service Commission for an electric rate increase of 19.34% with the residential rate increasing by more than 24%.

Xcel Energy agreed to cut its proposed electricity rate increase for North Dakota customers.

The agreement raises overall rates by 10.37%, with the increase for residential customers at 12.92%.

North Dakota customers have already been paying a higher electric rate this year under an interim rate increase. An average residential customer was paying $11.36 more per month under the interim rate. The final rate approved increased that by another 58 cents — $11.94 more than before the rate increase request.

Xcel had not asked for a rate increase in four years, which a company representative said was needed to address high inflation and investments in facilities. The rate increase will also help pay for a new Grand Forks service center, a new substation and equipment upgrades.

Xcel has about 97,000 customers in North Dakota, including in Fargo, Grand Forks and Minot.

Commission Chair Randy Christmann said the agreement reached with Xcel means that North Dakota customers will not be paying for what he called “green new deal” facilities in Minnesota.

The agreement lists 23 facilities — mostly wind and solar projects — that are excluded from cost-recovery.

“I think North Dakota customers should feel good about that,” Christmann said.

AARP, which filed a comment with the PSC objecting to the initial rate increase request, said Thursday it was glad the settlement does not include costs based on Minnesota decisions. But while the increase is less than originally proposed, AARP said businesses should bear more of the costs.

“Unfortunately, once again, we see a final settlement laying the onus on residential customers,” AARP North Dakota State Director Josh Askvig said.

Minnesota has been pushing utilities away from fossil fuels such as coal. Xcel is retiring coal-fired power plants in Minnesota earlier than North Dakota regulators anticipated.

Earlier in the meeting, the PSC approved extending a permit for mining coal at the Freedom Mine near Beulah.

Christmann attended the meeting remotely while traveling back from a regional power transmission meeting in Arkansas.

He said discussions about power grid reliability reinforced his support of North Dakota’s coal-fired power plants.

“It’s more important than ever to keep our baseload power plants operational,” he said.

Reach Deputy Editor Jeff Beach at jbeach@northdakotamonitor.com.