Xcel tiered rate plan debated in House
Xcel Energy’s tiered rate has caused consumers to pay higher utility bills than they should, Rep. Ray Scott told the Colorado House on Tuesday.
Not so, said Rep. Max Tyler, D-Golden.
The utility’s summertime rates are designed to encourage people to conserve energy, preventing Xcel from having to build expensive new power plants that customers ultimately finance, Tyler said.
The two were debating Scott’s bill, which calls for a study of whether the tiered rate plan actually prompts consumers to conserve.
The tiered rate allows Xcel to charge customers 4.6 cents per kilowatt hour for the electricity they use and increase that charge to 9 cents an hour for usage greater than 500 kilowatts.
Scott argued that most consumers average about 750 kilowatts during the summer.
“The tiered-rate programs that we have seen in the past have demonstrated that they are not working,” the Grand Junction Republican said. “When the average was set at about 750 kilowatts per hour and the second tier was set at 500, that becomes somewhat of a punitive penalty.”
Tyler said the whole point is to get people to use less electricity, which the rate accomplishes.
He said the Western Slope has long called on Denver to conserve water to avoid having to divert more to the Front Range. The rate works the same way, Tyler said.
“Rates have gone up for water in Denver, but they have not gone up nearly as astronomically as they would have if we had to build another reservoir,” he said. “We don’t want to keep building (power) plants for energy because that’s going to cost a whole lot more.”
The GOP-controlled House approved Scott’s measure on a voice vote. It requires another House vote, which could come as early as today, before heading to the Senate, where the Democrats have the majority.