AMARILLO, Texas (KFDA) - Xcel Energy plans to refund $39.4 million to customers in Texas, with residential customers receiving about $35 each.
According to an Xcel press release, this is due to continued low prices for natural gas power plant fuel and adding more wind energy to their system.
Commercial and industrial customers will receive refunds of varying amounts.
Those refunds will appear in the June billing cycle but could also spread over two months depending when the customer’s meter was read.
Xcel said electricity generated at natural gas-fueled power plants and from area wind farms is cheaper than electricity from coal-fueled power plants.
From 2017 to 2019, the average residential rate per kilowatt-hour declined by 7.6 percent due to lower fuel costs.
“Natural gas fuels close to half the electricity production in this region, and the prices we pay for this fuel have continued to fall,” said David Hudson, president of Xcel in Texas. “This reduction in prices is coinciding with a significant addition to our wind energy resources from the Hale Wind Project near Plainview, which is dramatically lowering fuel costs that are passed through to our customers.”
The new wind energy plants are not associated with fuel costs because they “capture the region’s free and abundant wind in the production of electricity,” Xcel said.
A second regional wind energy plant is being built near Portales, New Mexico. That project, the Sagamore Wind Project, is expected to reduce fuel costs further in 2021.
The refund proposal must be approved by the Public Utility Commission before it goes into effect.
If it is approved, it will be the third fuel cost refund since 2019.