Minnesota Power rate increase won’t hit homeownersFor Minnesota Power’s residential customers, it’ll be the best kind of rate increase: Monthly bills actually will go down.
By: Candace Renalls, Duluth News Tribune, Pine Journal
For Minnesota Power’s residential customers, it’ll be the best kind of rate increase:Monthly bills actually will go down.
That’s what will happen if the $54 million utility rate increase approved by the Minnesota Public Utilities Commissions on Tuesday passes its final hurdles in the next two months.
That $54 million figures out to be an 11.6 percent overall rate increase. But commissioners directed the Duluth-based utility to go easy on residential customers because times are tough. So rate increases will vary among customer categories.
Residential customers will see only a 4 percent rate increase, while Minnesota Power’s large industrial customers — mining plants and paper mills — will be hit with a 16 percent boost in rates.
For the average residential customer, that 4 percent hike amounts to $2.50 more per month. Because it will replace a temporary increase of $7 per month, average bills will actually drop $4.50 per month.
“During these economic times, commissioners did not want the residents to shoulder an increase,” Minnesota Power spokeswoman Amy Rutledge said.
But don’t expect a refund.
That’s because the $48.5 million interim rate increase Minnesota Power was allowed this year is less than the $54 million granted. The company initially asked for an
$81 million increase, but later reduced its request to $72 million.
“The company has nothing to refund,” said Pat Mullen, a company vice president. “They look at the total amount granted. … Only if the final order is less than the total are there refunds.”
In upcoming weeks, the commission’s written decision could be challenged by interested parties such as the Minnesota Attorney General’s Office. State Attorney General Lori Swanson has been critical of Minnesota Power’s requested rate increase coming on the heels of a rate increase granted a year ago.
Minnesota Power argued another rate hike was needed, in part, to pay for emission reductions and efficiency improvements at its Bos-well Energy Center in Cohasset.
Rate increases could go into effect as early as February.