DENVER — Xcel Energy is seeking another gas rate increase.
A $64 million gas rate increase was given the OK in November 2022, and now Xcel wants another $171 million. Xcel Energy Colorado President Robert Kenney said that the increase will mostly be spent on safety issues.
Thanks to a state law passed last year, in part because of reporting by 9NEWS, Xcel and other utilities need to be transparent about the last 10 years’ worth of rate changes.
The base rate that Xcel is seeking to increase was unchanged from 2014 to 2020.
From February 2020 to November 2022, the base rate increased nearly four times the amount.
That is where we start our conversation with Kenney.
*Editor’s Note: Answers have been condensed for clarity; you can watch the unedited raw interview here:
9NEWS reporter Marshall Zelinger: "If my Netflix went up four times the amount, I probably would want to ditch Netflix, but I can't ditch Xcel. So, what justifies an increase of four times the amount? And now perhaps even more?
Kenney: “The dollars that we receive from our customers, and you're referring to base rates, particularly with respect to our natural gas system, are going to be primarily used to fund the safety and the reliability of the system. And I think that that's something that we all share in common is a desire for a safe and reliable system. And so, the most recent case that we just filed, something like 60-some-odd percent of the investment in that case is going to safety, reliability and mandatory relocations; we sometimes have to relocate infrastructure based upon counties or cities doing infrastructure replacements themselves.”
“It is 56% for system safety and integrity plus another 7% was for the mandatory relocations that I was describing. So, that adds up to the 63% is for safety and reliability and mandatory relocations.”
“The gas cost adjustment sets the cost of the commodity, that's the molecule, the gas that gets burned to heat homes and to cook food. We buy that wholesale, and we don't charge any markup on that. So, when that fluctuates up or down, customers realize that immediately, so we file quarterly updates and adjustments to the gas commodity.”
“What we're also seeing is that this winter heating season, the gas commodity costs about 28% less than it was last winter heating season. And so, customers are seeing that as well.”
Zelinger: “You say ‘safe, reliable and resilient’ often. Are they like magic words? That if you say those words, you can justify the expenses and justify the rate increases?”
Kenney: “I wouldn't view them as magic words, I would view them as a true reflection of the obligation that we have.”
“In order to maintain the safety of the system, we've got to do preventative maintenance, we have to do inspections. And so, I view them as magic words only to the extent that it's a solemn obligation that we have to our customers.”
Zelinger: “Are you an Xcel customer?
Kenney: “I am, gas and electric.”
Zelinger: “Are you happy with your bill?”
Kenney: “I am happy with my bill, to the extent that I understand it, probably, more than the average customer or viewer. I understand what's required to provide the product that we provide. And I understand what's required to provide the service that we provide. I also know, and I will say this to you, Marshall, that I appreciate that there are certain of our customers that do have a harder time paying their gas and electric bill than do I, I'm very fortunate and very blessed. And so, I have a greater insight into where those dollars are going, what's required to run the system. And so, yes, I'm happy with the value that I receive for the dollar.”
“We already have energy assistance programs for both gas and electric. And we worked with the [Public Utilities] Commission to increase that by an additional $47 million.”
Zelinger: “But is that money paid for by customers?”
Kenney: “The additional $47 million is paid by customers. And that's not an uncommon construct throughout the country. And that allows us to be able to collect those dollars, and then distribute them as energy assistance.”
Zelinger: “How much is Xcel contributing on its own for energy assistance?”
Kenney: “We did contribute the $500,000 that we contributed to Energy Outreach Colorado. We also do quite a bit of foundation giving. Not just to energy assistance, but to a whole host of nonprofits, to the tune of something like $1.3 million, that we've contributed to a host of different nonprofits. And one other thing I will add is one of the efforts that we've recently instituted as well, to get more assistance to our customers, and to help our customers fill out the applications is our Red Truck initiative. And so, we've been going into the community physically, going out into our communities, to bring more information, energy assistance applications to try to get more customers connected with the energy assistance that's available.”
Zelinger: “I know customers who have reached out to me will be upset if I don't ask this. I've done several stories with Xcel customers who say that Xcel customer service was of no service. Customers who are overbilled, underbilled, and customers with meter issues. They got resolution from Xcel after they came to the news. What are you doing to better your customer service, so I don't have to do it?”
Kenney: “It is always my desire to provide outstanding and excellent customer service. We have to act like a competitive business and treat our customers as if they are ours to lose. I don't want a customer to have to come to you, Marshall, or go to the news to be able to seek resolution. And so, we know that we don't always fall short. My job, as the leader of operations here in Colorado, is to make sure that I am communicating with my co-workers and colleagues that customer service is ‘job one.’ And I can tell you that we strive every day to provide outstanding customer service. We also know that we sometimes fall flat and we try to make it right as quickly as we possibly can. But I know the 4,000 people that I work with get up and go to work every day with a servant's heart, and with a desire to do right by our customers. And so, I hope they don't have to call you, but we will work as quickly as possible to make it right.”
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