November 24, 2025 11:18 AM UTC

Opposing Big Electric Rate Increases is Smart Politics in 2026

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• by: Colorado Pols

Xcel Energy in Colorado submitted a request for a 10% rate increase on Friday. Xcel was no doubt hoping to avoid too much negative publicity by making the move  on the front end of what is a long holiday weekend for many people.

As Judith Kohler reports for The Denver Post:

Xcel Energy, Colorado’s largest electric utility, has asked state regulators for an increase of $355.5 million to its rate base, which would boost the average residential electric bill by nearly 10% per month. [Pols emphasis]

Xcel filed the proposal Friday with the Colorado Public Utilities Commission, which will take testimony from the company and various intervening parties and hold a public hearing. If approved, the increase would take effect in September 2026.

If you think Xcel’s request for a 10% increase seems excessive, you’re not alone:

“This rate case is to recover costs associated with investments that we’ve made over the last three years,” Xcel Energy-Colorado President Robert Kenney said.

The Utility Consumer Advocate, or UCA, which represents the public before state regulators, said the proposed increase is “too big of an increase.”

“It’s an especially large increase given the context of the economic times,” said Joseph Pereira, UCA deputy director.

The increase is largely related to Xcel’s expanded capital spending on distribution, transmission and generation, Pereira said. [Pols emphasis]

As we wrote in this space in August, Xcel Energy wants its residential consumers to foot the bill for its own infrastructure investments related to building out the grid to attract big data centers:

As companies compete to become the first to launch Skynet, the discussion about AI is quickly becoming about more than guidelines related to ethics and data privacy. The immense data needs for a functional AI system that does more than just produce weird Internet graphics are a problem all their own; AI data centers require massive amounts of energy and water (for keeping its exhausted servers cool). And so far, the proposals from those responsible for meeting those energy needs has been to ask public consumers — like you — to foot the bill.

As Theodore R. Johnson wrote last week for The Washington Post, politicians would be wise to push back on this sort of thing:

If this month is any indication, artificial intelligence has disrupted yet another part of American life: electoral politics. Nowhere was this more evident than in Georgia, where two Republican incumbents lost their seats on the Public Service Commission, the regulatory agency responsible for utility pricing. An AI data center construction boom across the state has caused consumers’ electricity costs to surge, leading voters to elect Democrats to state-level office for the first time in two decades…

…The evidence is everywhere. [Pols emphasis] In Virginia, the “data center capital of the world,” Democratic Gov.-elect Abigail Spanberger flipped the governorship by focusing on affordability and making rising energy costs a pillar of her campaign, winning majorities of voters in every income category. She also erased the diploma divide, winning college-educated voters who lean Democratic and noncollege voters who have shifted Republican. The Democratic wave continued in New Jersey, where nearly 90 percent of voters said electricity costs are a problem, and Gov.-elect Mikie Sherrill ran on freezing monthly bills. The result? The party’s margin of victory improved by 11 points over 2021’s gubernatorial election. And last November, Georgians in Columbia County outside Augusta backed Donald Trump by 25 points but this month elected the two new Democratic commissioners after Republican incumbents approved six electricity rate increases in the last two years.

Across the country, a majority of Americans report rising prices, and less than half think their states do a good job of regulating utilities. The parties’ views on government regulation differ dramatically, with supermajorities of Republicans believing it does more harm than good, and Democrats saying it benefits the public. But recent statewide elections suggest that voters are more willing to sideline their partisan identity in exchange for lower prices.

In the case of Xcel Energy in Colorado, opposing a 10% rate increase is an easy choice for politicians considering that 1) The economy is in bad shape and many people are struggling with high prices in general, 2) The last rate increase for Xcel — in 2022 — was only 3.2%, and 3) Xcel Energy made a $1.94 BILLION profit in 2024, an increase of 9.3% from the previous year.

There’s also reason to believe that Xcel’s request for a 10% increase is just the tip of the iceberg — with significant additional increases coming for consumers and no shield against surprise rate hikes (such as Xcel’s infamous tripling of prices during the winter of 2023).

The solution here isn’t all that complicated. If companies such as Google, Amazon, and Meta need more energy to support AI platforms, then they should fork out the money for infrastructure themselves. If that means these companies choose to build their data centers elsewhere…so what? Colorado would be better off with lower energy prices than with a couple hundred new jobs in 5-10 years.

Holding the line on allowing energy providers to pump consumers for infrastructure buildout isn’t just good policy — it’s good politics.