In December, the utility proposed moving to a “time-of-use” rate plan as the default way residents will be charged for their power usage.
Under the proposed plan, rates between 3:00 pm and 8:00 pm would be higher than the flat rate customers currently pay, while power used between 12:00 am and 6:00 am would see much cheaper rates. Rates would also be higher during the summer months than during the winter.
Amy Liberkowski is the Regional Vice-President of Regulatory and Pricing at Xcel Energy. She says the time-of-use rate allows customers to take control of their power bill.
In general, I think what time-of-use rates have shown is that they can create cost savings in the long run. From the company's perspective, we like that this provides customers another choice and more control over their bill. So for customers that are motivated, they can move some energy usage to other time periods, and have more control over the bill, and create savings for themselves.
Xcel conducted a pilot program in 2022 for the new rate plan. Over 17,000 customers in Eden Prairie and Minneapolis were involved in the pilot projects. Customers in Eden Prairie saw a monthly increase in their bill of 37 cents, while customers in Minneapolis reported a decrease of $1.08 per month.
If approved, the time-of-use rate would be the default rate for all residential customers. However, a customer would be able to opt out and return to a flat rate plan if they choose.
The proposed rate will not go into effect until after regulators discuss the change, and Xcel finishes installing more than 500,000 “smart meters” that will allow customers to track their power usage online.
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