Xcel Plans Rate Increase

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More bad news for Colorado consumers.

Xcel Energy -- the state's largest utility -- hopes to raise electricity rates beginning next month. If approved, the plan would raise rates about $3.50 per month for residential customers, and by about $7 for small businesses.

Xcel officials blame the rising price of natural gas, which is needed to produce electricity.

If approved by the Public Utilities Commission, the rate hike for more than a million customers will take effect January 1st.

Meantime, Xcel Energy says it would use state-of-the-art pollution controls on a new coal-fired power plant near Pueblo.

The company is seeking approval from state regulators to upgrade the Comanche Generating Station and build a new plant.

In a plan filed with the state Friday, the company says the new technology would produce more electricity but less pollution. Xcel also says it would rely on both fossil fuels and renewable energy as it renews contracts for electricity it purchases from other companies over the next 10 years.

Environmentalists had been critical of the Xcel's earlier pollution-control plans.

Xcel says this plan will save customers $500 million to $1.4 billion over other options.