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Xcel Energy files fuel account proposal

September 27, 2012

Xcel Energy residential and small commercial customers in Texas will see a small fuel cost surcharge on year-end bills, pending regulatory approval, as the company balances fuel accounts.
Texas industrial and large commercial customer classes will receive refunds.
Xcel Energy's Texas-based operating company, Southwestern Public Service Company, filed its plan for the fuel cost true-up yesterday at the Public Utility Commission of Texas. If it is approved, Texas residential customers that use 1,000 kilowatt-hours per month will pay a one-time surcharge of $3.38, split between two billing cycles, split between two billing cycles, beginning with December bills. The surcharge will expire after the amount is collected.
The fuel charges make about half the cost of a typical month's bill, and cover the costs for coal and natural gas used in area power plants, as well as the costs for purchased power.
Xcel Energy earns no profits from fuel charges, which are passed through dollar-for-dollar. As the fuel costs are collected, they are deposited into accounts that are used for paying fuel bills. The accounts are tracked by customer class and reviewed from time-to-time to see that the accounts are balanced.
A true-up can lead to both surcharges and refunds because usage patterns differ among customer classes. Residential and small commercial customers tend to use more power and more fuel during the summer months. Usage patterns among large commercial and industrial customers usually stay roughly the same across a 12-month period.
In May, the early cancellation of a fuel cost surcharge, just as some classes started using more power, led to a slight under collection of fuel costs for the residential and small commercial classes, creating the need for an additional fuel charge to balance fuel accounts.
The early expiration of the surcharge, combined with a lower fuel cost factor implemented in April, led to a $10 savings on typical residential bills of 1,000 kilowatt-hours.

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