Xcel Energy files for lower fuel costs in Texas

AMARILLO, Texas – Xcel Energy submitted plans to the Public Utility Commission of Texas (PUCT) today for a revised fuel cost formula and factor that will reduce residential bills of 1,000 kilowatt-hours by an average of $1.83, or about 1.8 percent, starting April 1.

The fuel factor is a pass-through charge on customer bills to recover the cost of fuel used by generation plants and energy purchased from other generators. The factor on customer bills can be adjusted up to three times a year in Texas to reflect rising and falling costs along with fuel mix changes. A drop in natural gas prices over the past year has offset higher natural gas usage in the company’s generation fleet.

Another factor holding down fuel costs this year is the delay of a costly new federal emissions rule that was set to take effect on Jan. 1. Xcel Energy’s only viable short-term compliance option to the Cross-State Air Pollution Rule was to reduce the output of lower-cost coal-fueled power plants and depend on natural gas-fueled plants for the bulk of power generation. Compliance would have increased costs of all fossil fuel generation despite lower natural gas prices. A federal appeals court issued a stay of the Cross-State rule Dec. 30, which temporarily delayed the effective date of the rule until the court takes up the merits of lawsuits filed in opposition.

“We’re pleased to announce the reduction in the fuel cost factor, and that our joint efforts to oppose the Cross-State rule have helped contain expected increases in bills,” said Riley Hill, president and CEO of Southwestern Public Service Company, an Xcel Energy company. “Moving forward, investments in new, more efficient generating units and new transmission lines will help us keep downward pressure on fuel costs.”

Xcel Energy (NYSE: XEL) is a major U.S. electricity and natural gas company with regulated operations in eight Western and Midwestern states. Xcel Energy provides a comprehensive portfolio of energy-related products and services to 3.4 million electricity customers and 1.9 million natural gas customers through its regulated operating companies. Company headquarters are located in Minneapolis.               

This news release includes forward-looking statements that are subject to certain risks, uncertainties and assumptions. Such forward-looking statements are intended to be identified in this document by the words “anticipate,” “estimate,” “expect,” “projected,” “objective,” “outlook,” “possible,” “potential” and similar expressions. Actual results may vary materially. Factors that could cause actual results to differ materially include, but are not limited to: general economic conditions, including their impact on capital expenditures; business conditions in the energy industry; competitive conditions in the marketplace, etc.