Xcel Energy rolled out higher rates earlier this year and if all increases are approved, Xcel Energy says the average household should expect total gas and electricity bills to jump by more than $16 a month in 2022. Effective April 1, Xcel implemented a 6.5% rate increase on residential electricity rates in Colorado. This rate increase was based on a July 2021 rate case approved by the Colorado Public Utilities Commission (CPUC).
On top of the April 1st rate increase, Xcel was awarded court approval to recover more than $500 million of February 2021 storm-related costs. The commission is expected to conclude its review of the settlement this summer. Once completed, this cost recovery will be spread out over two years and increase electric customer's monthly bill by $1.43 for 24 months as an increase of $5.67 per month for 30 months.
That brings an effective electricity rate increase of 8.2% this year and a natural gas rate increase of 11.6% this year. And the rate cases keep coming. Xcel also has a rate case pending for another natural gas price increase that will be decided in the second half of 2022 with rates effective in November 2022. Recent research reports estimate that Xcel is likely to raise pricing by at least 8% per year through at least 2024.
The utility is also making progress installing smart meters around the Denver metro area, which will charge customers different rates based on time of use for additional electrical bill increases. Peak time-of-use rates will be 2 p.m. to 6 p.m. in the summer. The lowest rates will be from 9 p.m. to 9 a.m., so late night laundry and dishwashing could become the norm. Based on the map shown here, we expect most residences in the northern Denver metro area will have a smart-meter replacement and new time-of-use pricing in the second half of the year.
Finally, there are rumblings and growing concern that extreme heat and increased electrical consumption from home cooling and electric vehicles could lead to rolling blackouts in Colorado similar to those that have now become commonplace in California.
We've all seen utility bills skyrocket lately - and the costs aren't expected to stop climbing anytime soon. The time is now to alleviate dependency on fossil fuels and transition to clean, renewable energy with a solar and battery storage system. We are here to help Coloradans future-proof their homes and reclaim their Independent Power.