In the midst of an effort to win a 10.7 percent rate hike that it says it needs to remain competitive, executives at energy utility Xcel are defending the money it spends on employee compensation.
The Minnesota Department of Commerce is challenging the rate increase, which would amount to about $285 million, saying Xcel should cut $22 million in bonuses for Xcel executives and expensive flights on corporate jets. Officials are also concerned about cost overruns on upgrades to Xcel's nuclear plant in Monticello.
Xcel Regional Vice President Laura McCarten said the compensation helps the utility attract top talent.
"We have to compete in the marketplace for good quality employees, so we think it's important that our compensation packages really be pegged to the market average," McCarten said. "We understand it's very important for us to control our costs, and to date our costs are below the national average, so I think we've done a pretty good job."
The costs at Monticello are the result of "the investment we're making into our nuclear plants so that they can operate another 20 years to serve our customers, and also costs to invest in our electric grid to make sure that that's robust and reliable," she added.
The utility applied for a 10.7 percent rate increase in November, and the Public Utilities Commission has granted a more than 9 percent hike in the interim.
The proposal triggered a series of public hearings, which will begin at 1 p.m. Monday at the Earle Brown Heritage Center in Minneapolis. There will be six other hearings including in St. Cloud and Mankato.
Public comments may also be made online at the PUC's website.
The Public Utilities Commission is expected to decide the rate case this fall.
Nancy Lebens contributed to this report.