Xcel Energy has proposed freezing its electric rates for the next two years amid growing concerns from Minnesotans about rising utility costs. The state’s largest electric utility filed a plan with the Minnesota Public Utilities Commission last week, stating it would postpone any rate increases until at least November 2028. In exchange, Xcel seeks permission to access federal tax credits from planned battery storage projects earlier than expected.
The proposed rate freeze comes as the utility aims to continue investing nearly $4.5 billion in Minnesota’s electric system over the next two years. Xcel hopes the plan will help offset rising costs while maintaining reliable service. “This request demonstrates Xcel Energy’s commitment to keeping rates stable today while continuing to deliver safe, reliable electric service and make investments that power tomorrow,” said Bria Shea, president of Xcel in Minnesota, North and South Dakota.
The proposal follows recent backlash over Xcel’s most recent rate increase, approved in June, which raised rates by 5.8 percent over two years. The increase drew thousands of complaints, prompting Minnesota Attorney General Keith Ellison and consumer advocates to ask regulators to reconsider. The Public Utilities Commission declined but launched a statewide investigation into the affordability of electric and natural gas services.
Xcel expects to receive federal tax credits from the Inflation Reduction Act for five battery projects near the retiring Sherco coal plant in Becker, its Blue Lake facility in Shakopee, and in Nobles County. The utility hopes these credits will support its ongoing investments and help manage rising costs.