Colorado consumers will get hammered with a major increase in electric bills – on top of soon-to-soar heating costs – under a price hike filed Wednesday by Xcel Energy.
Xcel asked state regulators to approve a 30 percent increase in monthly electric bills, effective Nov. 1. For the average residential customer, monthly electric costs would rise $16 a month, from the current $53 to $69. The price hike is a direct pass- through to consumers as a result of increased costs to Xcel.
Xcel further forecasts that winter heating bills for typical residential customers will increase by $44, from $127 last December to $171 this December.
The combined monthly costs for electricity and natural-gas heating this December would be $240, a huge jump of 33 percent from last year.
“It’s going to be bad, really bad for consumers,” said Ron Binz, a utility analyst and former head of the Colorado Office of Consumer Counsel. “And unfortunately we probably haven’t yet seen the full brunt of higher (fuel) prices still in the pipeline.”
Xcel said the proposed $116 million hike in electric rates stems from higher prices for coal and natural gas – the utility’s two main fuels used for generating electricity.
State law allows utilities to pass changes in fuel costs directly through to consumers, without taking profits or losses. The Colorado Public Utilities Commission, which regulates Xcel, typically approves such fuel-cost rate hikes quickly.
Businesses also will be hit by Xcel’s higher rates. The typical small business will see electric rates increase from $102 to $134 per month. Natural gas bills will rise from an average of $573 last December to an estimated $776 this December.
Analysts said the increase in electric rates will come as a shock to consumers, who already were facing record high costs this winter for natural-gas heating.
Agencies that offer utility-bill help for low-income consumers, such as Energy Outreach Colorado and the Low Income Energy Assistance Program, said they were facing funding shortfalls before Wednesday’s news of higher electric bills.
“There will be very significant problems for anybody in the range of low-income levels,” Binz said. “But on top of that, we’re starting to see prices that are really going to sting middle-class consumers.”
Natural-gas costs nationally have more than tripled in the past three years because of strong demand and flat production. Prices spiked even higher during the last month because of hurricane damage to gas wells in the Gulf of Mexico.
But unlike recent price hikes in crude oil and gasoline that have had an immediate impact on consumers, the soaring increases in natural gas are just beginning to be felt with the onset of cooler weather.
“I think it’s a tragedy to low-income people to have that kind of increase at this point, particularly with all the economic problems, Hurricane Katrina and the cost of gasoline,” said Marty Meinberg, 57, a Denver homeowner. “I think it’s really going to pinch low-income families for what they spend on the basic necessities. I have a big concern with who’s profiting from this when low-income people are doing so poorly because of it.”
Energy and utility analysts said it is more important than ever for consumers to conserve electricity and natural gas by keeping lights turned off, turning down thermostats, and making homes as weather-tight as possible.
“Consumers need to conserve every bit of energy they can,” said Jim Greenwood, director of the Colorado Office of Consumer Counsel. “And if they can switch to budget billing, that’s a good thing.
Xcel’s budget-billing program gives consumers a pre-determined, unchanging energy bill each month, based on estimates of annual power and gas use. It evens out the highs and lows of seasonal changes in billing and is adjusted once a year.
Staff writer John Wenzel contributed to this report.
Staff writer Steve Raabe can be reached at 303-820-1948 or at sraabe@denverpost.com.
