Xcel Energy Proposes $318 Million Refund for Minnesota Customers

MINNEAPOLIS — Xcel Energy announced Monday that it plans to refund a total of $318 million to its residential customers in Minnesota. The refund stems primarily from federal tax credits related to nuclear energy generation, marking the first time customers will receive savings from a nuclear energy tax credit.

The proposed refunds would provide an average of $81 back to residential customers, effectively decreasing their monthly bills through March 2026. Xcel Energy attributes over half of the total refund amount, approximately $176 million, to federal tax credits for nuclear energy production created under the Inflation Reduction Act.

Ryan Long, president of Xcel Energy—Minnesota, North Dakota and South Dakota, stated, “We’re committed to supporting our state’s economic growth, investing in our communities, delivering reliable and resilient electricity, all while keeping customers’ bills as low as possible.” He added that tax credits on nuclear energy generation help create savings and provide additional value for customers.

The remaining portion of the refund consists of $94 million from lower fuel costs and $48 million related to an outage at the Sherco coal plant in 2011. According to Xcel, costs attributed to fuel can fluctuate, and the company refunds customers when prices drop below expectations.

Although the proposal has been filed, it must receive approval from the Minnesota Public Utilities Commission. Should it be approved, the refunds would significantly contribute to customers’ bills, reflecting the company’s ongoing commitment to cutting costs and enhancing value amid evolving energy regulations.

Xcel Energy operates two nuclear facilities in Minnesota, located in Monticello and Prairie Island, which provide about one-quarter of the electricity consumed by Xcel customers in the Upper Midwest. This refund proposal coincides with renewed interest in the state legislature for policies that would incentivize greater nuclear energy generation within Minnesota.