Meghan O’Brien/South Dakota Searchlight
PIERRE — A panel of South Dakota regulators approved an electric rate increase Friday for Xcel Energy customers and allowed eight entities to intervene in a pending Black Hills Energy rate case.
Xcel initially sought an increase last June that would have raised the average bill for its residential customers by 19%, equating to about $21 per month. That would have raised $43.6 million in additional annual revenue. The company has about 107,000 customers in South Dakota, mostly in the Sioux Falls area.
The Public Utilities Commission approved a settlement that will increase the average residential customer’s monthly bill by 12%, equating to $13.48 per month, resulting in an annual revenue increase of $25.6 million for Xcel.
The higher increase was in effect on an interim basis while the rate case proceeded. Customers will receive refunds with interest for the difference between the higher interim rates and the rates approved in the settlement Friday. The average residential customer’s interim refund will be about $43, according to a customer notice.
The company told commissioners that it needs the increase to help pay for its “significant investments in its distribution system in South Dakota,” including generation facilities, its transmission system and the replacement of aging technology. Inflation has also impacted the company’s business costs, Xcel said.
Commissioners also approved the intervention of eight entities in a Black Hills Energy rate increase case: Dakota Panel, Fischer Furniture, Forest Products Distributors, GCC Dacotah, Monument Health Rapid City Hospital, Pete Lien & Sons, the South Dakota Science and Technology Authority, and Spearfish Forest Products.
Those entities are now official parties in the proceedings related to Black Hills Energy’s rate increase. The utility company is seeking an increase that would raise the typical residential customer’s bill by 25%, which would add $25.13 to the typical customer’s monthly bill.
The Xcel and Black Hills cases come on the heels of the commission’s approval in March of a rate increase by Otter Tail Power, which raised its typical residential customer’s monthly bill by $8.97, an increase of about 8%.