Colorado regulators approve Xcel Energy rate increase, raising monthly electric bills

Some Coloradans can expect to pay more on their monthly bills after the Colorado Public Utilities Commission approved an Xcel Energy rate increase Wednesday.

Under the approved plan, residential customers will see an average increase of about $5 per month, while commercial customers will pay about $7 more each month. The rate hike goes into effect at the end of December of this year. 

The increase is significantly smaller than Xcel's original request. The utility initially sought a revenue increase of $356 million but later reduced that request to just over $150 million following feedback from regulators and customer opposition.

"The revised revenue requirement increase means an estimated residential average monthly bill increase of $5," Xcel staff member Ellie Friedman told commissioners during Wednesday's hearing.

While commissioners approved the rate increase, some expressed concerns about the long-term affordability of electricity.

Public Utilities Commission Chairman Eric Blank noted that despite declining electricity sales since 2021, Xcel has sharply increased its capital spending, from $1.6 billion in 2021 to $5.4 billion in 2025.  He says the utility is proposing to spend nearly $6 billion in 2026.

"At the end of the day, I remain concerned that if capital spending and rates continue to grow at levels considerably faster than inflation, electricity may simply become unaffordable for many," Blank said.

Xcel uses something called "share of wallet" to argue its rates are affordable, claiming that Colorado residents spend less than 1% of their household income on electricity. 

CBS Colorado has reached out to Xcel for a comment on the price hike during a summer that has broken heat records in Colorado.