Xcel Energy sees $1.4B in cost savings through Inflation Reduction Act
Xcel Energy’s Minnesota customers are expected to save an estimated $1.4 billion in costs over the next 10 years through provisions in the federal Inflation Reduction Act.
In a filing with the Minnesota Public Utilities Commission, Xcel Energy outlined its plan to leverage new and extended tax credits and grant programs in the IRA to pass savings on to customers.
Specifically, the company estimates $490 million in incremental savings for existing projects through 2027 and an estimated $1 billion in additional savings for new projects through 2034 under the IRA.
“Our investments to date in wind energy — a power source that carries no fuel cost — have already saved our customers money, lowering costs in the Upper Midwest by nearly $1 billion from 2017 to 2021,” said Chris Clark, president of Xcel Energy–Minnesota, North Dakota, and South Dakota. “The Inflation Reduction Act opens up opportunities for us to build upon that progress with additional cost savings that we can pass on directly to our customers. At the same time, the IRA will support our ongoing investments toward a future of 100% carbon-free electricity.”
In the filing, Xcel outlined where some of the savings will be achieved. Among them, it expects an estimated 30 percent customer savings on the 460-megawatt Sherco Solar project. Also, tax credits included in the IRA will reduce the cost of major energy generation and energy storage projects. Further, Xcel Energy will be able to sell its unused renewable energy production tax credits to other organizations, reducing its costs to customers.
In addition, company officials stated that savings on projects in wind, solar, energy storage, electric vehicle chargers, and more will help the company reach its goal of reducing carbon emissions from electricity by 85 percent by 2030 in Minnesota.
