Xcel Energy will file revised versions of inaccurate financial documents Thursday after recently admitting to an error in its calculations of proposed rate increases, according to documents from Xcel.
The June filing by Xcel proposed a wholesale electricity rate increase of about 5 percent. According to Larry Covillo, Yampa Valley Electrict Association president and general manager, YVEA's yearly wholesale electricity bill from Xcel is nearly $20 million. Covillo estimated that the rate increase would cost YVEA an additional $1.25 million per year.
However, in reviewing Xcel's proposal, YVEA and Holy Cross Energy uncovered an error of $80 million in Xcel's financial statements.
Xcel publicly acknowledged the error late last week and promised to "supplement its rate filing" with accurate documents that will "reflect correction of the income tax error." Xcel did not disclose the amount of the error.
"We acknowledge an error in the calculation of the increase which we will further discuss with YVEA, Holy Cross and others," Xcel spokesperson Mark Stutz said.
Covillo said according to his calculations the amended filing could result in rate reductions to YVEA of around 1 percent, or $200,000. Covillo warned this estimate only reflects rate reductions based on the $80 million error and does not factor in possible adjustments related to YVEA's other complaints against the rate increase. Furthermore, Covillo noted that $200,000 would just cover YVEA's legal expenses in protesting the rate increase.
Xcel's answer does concede that rate reductions are a possibility, saying the supplemental filing "will result in smaller rate increases for some customers, no rate change for (Intermountain Rural Electric Association) and rate decreases for other customers."
Xcel would like to pursue settlement discussions with YVEA and other customers, Stutz said.
"I'm encouraged that they (Xcel) asked for a settlement conference. Usually we have to ask for it," Covillo said.
Covillo noted YVEA had requested a settlement conference in other litigation with Xcel concerning fuel cost adjustments (FCA), but the two sides could not come to an agreement. The fuel cost adjustments hearing is scheduled to go before the Federal Energy Regulatory Commission Aug. 14.
Covillo suggested that it might be possible to settle both the fuel cost adjustments case and the rate case in the same settlement meetings. He said YVEA could be willing to settle the fuel cost adjustments case if Xcel gives up something in the rate case, or vice versa. There is room for negotiation, but Covillo said it is too early to speculate on the concrete issues of the matter.
"The reality is we need to see the Aug. 1 filing," Covillo said.
Jeremy Browning can be reached at 824-7031 or firstname.lastname@example.org.