The following is a news release from Xcel Energy:
Lower prices for the natural gas Xcel Energy uses to produce electricity at area generating plants are leading the company to reduce the monthly fuel charges Texas customers pay, a move that will result in lower bills going into the summer months.
If the adjustment to Xcel Energy’s fuel factors is approved by the Public Utility Commission of Texas, a typical residential customer using 1,000 kilowatt-hours per month will see an average monthly decrease of $6.95 – or 6.3 percent starting May 1. Fuel costs on New Mexico customer bills are adjusted monthly, so New Mexico customers are already seeing these savings on their bills.
“Fuel costs make up about a third of a typical residential bill, and they include the cost to purchase natural gas and coal to fuel our generating stations, as well as the cost of power purchased off our system,” said David Hudson, president, Xcel Energy – Texas. “Natural gas prices have fallen 47 percent over the past year, which is the main factor in bringing down our overall fuel costs.”
Fuel costs are dollar-for-dollar, pass-through charges that, in recent years, have risen and fallen primarily because of volatility in the cost of natural gas used to produce close to 40 percent of the region’s electricity supply. Xcel Energy does not earn profit on fuel costs. Texas fuel costs increased twice between October 2016 and February 2017 when natural gas market prices were trending higher.
“Though natural gas prices are at historic lows now, they likely won’t stay that way,” Hudson said. “This is why we are focusing our efforts on controlling fuel costs by making our generation and delivery systems more efficient and adding new supplies of wind energy.”
Clean energy resources such as wind and solar have no associated fuel costs, a primary reason the company is seeking to add 1,230 additional megawatts of wind generation to the regional generating mix. The company is awaiting approval from the Public Utility Commission of Texas to build large wind farms near Plainview, Texas, and Portales, N.M. Regulators in New Mexico have already approved the plan.
“If our wind expansion plan is approved, customers can expect further fuel cost decreases in 2019 and 2020 when these new wind facilities come on line,” Hudson said.
About Xcel Energy
Xcel Energy (NASDAQ: XEL) provides the energy that powers millions of homes and businesses across eight Western and Midwestern states. Headquartered in Minneapolis, the company is an industry leader in responsibly reducing carbon emissions and producing and delivering clean energy solutions from a variety of renewable sources at competitive prices. For more information, visit xcelenergy.com or follow us on Twitter and Facebook.
(News release from Xcel Energy)