Duluth-Based Minnesota Power Seeking 18% Customer Rate Increase

Minnesota Power, a Duluth-based company, announced Monday that they are filing a request with the Minnesota Public Utilities Commission to increase its annual operating revenue by $108 million and adjust rates for its retail electric customers.

This would mean that rates for Minnesota Power customers would increase by about 18%. Minnesota Power says the increase is needed due to expenses related to changes changes in revenue and expenses related to Minnesota Power’s ongoing EnergyForward clean energy transition, evolving customer demand, business operations and regulatory requirements since the company’s last completed rate review submitted in 2016.

The company points out that they have only complete three full rate reviews in the past 25 years.

“Rate reviews are part of doing business as a regulated utility, and we’ve worked hard to keep rates affordable for customers by keeping operations and maintenance costs to 2010 levels,” said Minnesota Power Chief Operating Officer Josh Skelton. “The investments we have made in our EnergyForward plan over the past five years and the changing demand for energy require the company to seek this review. We understand our customers have high expectations that this energy transformation is done the right way, with thoughtful planning and efficient coordination of
resources.”

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If the full 18% rate increase is approved, a typical residential customer with a monthly usage of 701 kilowatt-hours would see an increase of about $15 a month. A small-business customer with a monthly usage of 2,581 kilowatt-hours would see an increase of $55 per month.

In the meantime, Minnesota Power has requested an interim rate increase of approximately 14% for all customers beginning in early January 2022. According to Minnesota law, the MPUC will approve an interim rate increase that will remain in effect until a decision is made on final rates. If the approved final rate is lower, the company will refund the difference to customers with interest.

Frank Frederickson, vice president of customer experience, states that if this request is ultimately approved by the MPUC, the average monthly bill for our residential customers will remain below the national average and customers will receive the highest percentage of renewable energy in the state.

Furthermore, usage-qualified low-income customers will continue to have some of the lowest average bills in the state due to special discounts included in the company’s recent rate design transition.