Xcel Energy is seeking $109 million of rate increases from its natural gas customers over three years, which would raise the average household bill 9.6 percent to $56.36 a month.
The Minneapolis-based utility company, which has about 1.3 million natural gas customers in Colorado, filed its rate request Tuesday with the Colorado Public Utilities Commission.
The rate request is being fueled by projects to upgrade Xcel’s 2,400 miles of transmission pipelines and 2,300 miles of distribution pipelines to homes and businesses.
Some of the Xcel pipes were more than 60 years old. After eight people died in a 2010 pipeline explosion in San Bruno, Calif., federal officials called on utilities across the nation to replace aging lines.
Since 2012, Xcel has replaced 198 miles of pipe, including all the cast-iron pipes in its system and most of the bare-steel pipes. It still must replace PVC and cellulose-based pipes, the company said.
The company said it plans to replace 275 miles of pipe by 2017.
“How fast do you want this work done?” said Alice Jackson, vice president for rates and regulatory affairs at Xcel’s Colorado subsidiary. “That is the question we are presenting to the PUC.”
The Colorado consumer counsel’s office is set to review the rate request.
“We are looking forward to examining the details but haven’t seen the filing yet,” said Cindy Schonhaut, executive director of the counsel’s office.
Under the proposal, the average residential bill, for 64 therms of gas, would rise $1.76 in 2015, $1.10 in 2016 and $1.57 in 2017.
The commercial rate would rise 6 percent over three years to $230.09 a month for 275 therms of gas.
Part of the rate increase would come in the base rate, which is calculated so the company gets a return on infrastructure investments it has made.
Xcel has made $1 billion in pipeline investments since 2012, Jackson said.
A second part of the rate hike comes from a charge, or “rider,” on the bill for specific pipeline projects.
The rate increase will also finance improvements to the distribution system to prevent equipment failures in the system, such as the one in Boulder County in December 2013 that left 7,200 homes in Niwot and Gunbarrel without gas for several days, Jackson said.
Mark Jaffe: 303-954-1912, mjaffe@denverpost.com or
