Over the last year, we know our customers have had to deal with higher prices for everything from gas to eggs to energy. Unfortunately, those higher prices have also affected utility bills. We’ve heard from you that, during this cold winter, your Xcel Energy bills have never been higher. And we know that some of our customers are having a hard time making ends meet.
We hear you. That’s why I’m writing today to share what we are doing to help our customers.
We offer dozens of energy- and money-saving options for all customers, including rebates, home energy audits, and discounts on items that can help reduce energy costs. We also offer income-qualified customers products to track their natural gas and electric consumption, and provide products, services, and education designed to help lower energy bills.
We’ve also stepped up our efforts to connect customers who are having difficulty paying their bills with programs that can help. Our longstanding energy assistance program helps those in need by capping Xcel Energy costs for eligible customers at 6% of household income. We also work with state and local agencies and other partners to direct payment assistance to customers with the greatest need. In 2022 alone, about 71,500 Colorado customers received approximately $87.5 million in energy bill assistance.
If customers face challenges paying their bills, we encourage them to contact us to learn more about payment assistance and other options for managing their bills, including our Averaged Monthly Payment program, which makes monthly energy bills more predictable.
And we are continually looking for more ways to do right by our customers. This week we will make a significant donation to Energy Outreach Colorado to further assist our customers who need help with their bills.
We are creating a low-and fixed-income advisory group to help us explore more and creative solutions to helping all our customers use energy more affordably. We know that we don’t have all the answers and that we need help from others to find creative solutions.
And this summer, in preparation for next winter, we will ramp up our efforts to offer energy audits and weatherization to income-qualified neighborhoods to make sure our customers have the equipment they need to help keep bills low and their make their homes ready for winter.
All these programs will help our customers, especially our low-income customers, weather the challenge of high energy bills. But it’s also important to understand what is driving higher bills. First, natural gas prices on a global scale have been much higher throughout this winter. Supplies of natural gas, in part driven by limits on domestic production, have been constrained. We’ve seen increased demand as the economy recovers and reopens from the COVID-19 pandemic. And world conflicts like those playing out in Ukraine have cause natural gas prices to spike.
The second major factor driving up energy bills this winter is that it has been historically cold – driving customers across our state to have to use much more natural gas just to keep their homes at the same temperature they always have. In fact, on December 22, 2022, the temperature dropped to 24 degrees below zero. That is the coldest official temperature in Denver in over 30 years.
A silver lining is that natural gas prices have come down recently and are projected to continue to fall in the coming months. As prices come down, we adjust our rates to pass along those decreases to our customers.
It’s also important to note that we don’t make any money on the commodity that we sell to our customers. What we pay for natural gas is exactly what we charge our customers. There’s no markup; we don’t make a dime on the sale of the natural gas that hits your bill.
That doesn’t mean we aren’t doing everything possible and using all available tools to make sure we are getting the best deals for our customers. We take steps to buy and store natural gas before we need it so that we have ample supply on hand at the least cost. We also take care to use financial instruments to protect against price fluctuations. Finally, we have increased our communications with our customers, sending customer alerts when gas prices hit high thresholds and providing tips on how to save energy and money.
We’re also saving our customers money through the investments we are making in wind and solar. For example, because wind and solar power generate electricity without fuel cost, our clean energy investments have saved Colorado customers almost $700 million in avoided fuel costs and tax credits from 2017 to 2021. Those savings will increase as we continue adding renewable energy to the grid.
And we are committed to building thriving Colorado communities, spending more than $500 million with local suppliers in 2021 and paying more than $225 million in property taxes, taxes that support the needs of the communities we’re privileged to serve.
Our more than 4,000 employees who call Colorado home – your family, friends, and neighbors – work every day to find energy solutions that keep costs low for our customers. And those same family, friends, and neighbors are working to build their communities. During our 2022 annual Day of Service, nearly 2000 Xcel Energy coworkers, retirees, family, and friends from around state volunteered with local nonprofit organizations. They also donated more than $800,000 to support hundreds of nonprofits and United Way chapters.
We understand that energy is a necessity in people’s lives. From lighting the darkness and powering our economy to keeping our families warm on the coldest nights, we are here every day for our customers and our communities. Through hard times we stand by our customers and will work diligently as trusted partners to help you power on, while transforming our business to anticipate and better serve your needs long into the future.
We hear you Colorado, and we will continue working hard every day to earn your trust and be your preferred energy provider.
Robert Kenney, president, Xcel Energy-Colorado