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Xcel will reassess investments in Minnesota after regulators' rate hike de... https://www.startribune.com/minnesota-regulators-approve-9-percent-th... "I think the ALJ report is thorough and the findings are well grounded," PUC Commissioner Valerie Means said at Thursday's hearing. While the PUC adopted many of the ALJ's findings, it did not on one critical point — Xcel's allowed return on equity. Xcel argued its guaranteed ROE should be raised from 9.06% to 10.2%, saying it needs to be competitive with other utilities in capital markets. Moseng found that 9.87% is a "reasonable" return for Xcel. Commerce has said that Xcel has been "flourishing" at its current ROE, though an increase to 9.25% was merited. CUB, the ratepayer watchdog group, has recommended that Xcel's ROE be lowered to 8.8% to 9%. The PUC adopted the Commerce's Department recommendation by a vote of 3-2. "I am comfortable with the department's solid analysis," said Commissioner Matt Schuerger, who along with Sieben and Commissioner John Tuma voted for the 9.25% ROE. Two commissioners, Means and Joe Sullivan, argued that Xcel's ROE should have been set at 938%. Sullivan argued that the 9.25% is "dated," and that financial markets have since "deteriorated a bit" while interest rates have risen — all warranting a slightly higher ROE for Xcel. The PUC Thursday also reduced Xcel's monthly basic service charge to $6 for residential and customers. That rate has been $8 to $10 per month. However, Xcel said in a statement that customers' kilowatt -per -hour energy charges will go up to compensate for the lower fixed monthly charge. "This shift disproportionately increases rates for households with large families," the company said. CUB's Levenson -Falk said the lower monthly charge will have a positive impact. If consumers conserve power, the lower fixed charge "makes the savings more meaningful," she said. The PUC also approved a discount rate for low-income households with low energy usage. Xcel and several other parties favored this new program. The discount will affect about 100,000 Xcel customers, said Catherine Fair, head of St. Paul -based Energy Cents Coalition, a nonprofit advocacy and assistance group for low- income utility customers. The discount will be up to $14 per month for qualified customers, she said. Mike Hughlett covers energy and other topics for the Star Tribune, where he has worked since 2010. Before that he was a reporter at newspapers in Chicago, St. Paul, New Orleans and Duluth. mike.hughlett@startribune.com 612-673-7003 172 3 of 3 6/2/2023, 12:04 PM