CenterPoint agrees to smaller gas bill hike for Minnesota customers

Homeowners would pay an extra $3.97 on an average monthly gas bill under an agreement with CenterPoint Energy, less than half the increase originally sought by the company.

Houston-based CenterPoint announced Monday evening it struck a deal with consumer advocates and labor groups to limit rate hikes to 5.2% for residential customers and between 6-12% for commercial customers.

The Minnesota Public Utilities Commission has the final say on CenterPoint’s rates and is expected to weigh in next year.

The five member board has often approved settlements like the one signed between CenterPoint, Attorney General Keith Ellison, Gov. Tim Walz’s administration, a nonprofit consumer advocate organization, two trade unions and a consortium of suburban cities from the Twin Cities metro.

“Any increase in energy cost is difficult for many people, I mean there’s no question about that,” said Annie Levenson-Falk, executive director at the Citizens Utility Board of Minnesota. “But at the same time, we understand that costs go up for utilities too. We can’t exactly celebrate any rate increase but we think this settlement is a reasonable middle ground.”

CenterPoint initially wanted a two-year, 10.2% increase in revenue averaged across all of its customers, saying last November that it needed the money to improve the safety and reliability of its gas system, and to comply with a state law that allows gas utilities to pursue innovative technology that cuts carbon emissions.

The proposal was met with skepticism by groups like CUB, which said the rate hike would come on top of other recent increases.

Wesley Lund of Hastings was one of many Minnesotans to write the PUC in opposition to higher prices. “No doubt you are aware that rate hikes of any nature have a greater impact on retirees and poorer residents in Minnesota,” Lund wrote in late September. “While CenterPoint also experiences rising costs, they do not need to be a source of increased costs for many in our state.”

CenterPoint’s settlement would raise $103.5 million in revenue for the company over two years.

Company spokesman Joshua Solis said the settlement still allows CenterPoint to make meaningful investments in its infrastructure and climate projects.

“These proposed investments will enhance our ability to deliver energy when customers need it most to help them withstand the coldest days of winter and to keep them safe and warm,” said Brad Steber, CenterPoint’s vice president of Minnesota Gas, in a statement.

The average residential customer will actually get a refund on 2024 bills if the PUC approves the deal. That’s because customers are already paying higher rates that were set by the commission as a temporary measure. The amount of a refund is based on energy use.

CenterPoint is the state’s largest gas heating provider and has more than 920,000 customers in Minnesota. In 2022, the PUC approved a $48.5 million increase in ratepayer revenue for CenterPoint. Commercial customers picked up a larger proportion of the increase for that rate hike, too.