Xcel Energy CEO Made $26.2 Million in 2018 As Your Electric Bill Reached a New All-Time High
The Star Tribune recently ran a piece announcing that Xcel Energy CEO Ben Fowke was the third-highest paid CEO in Minnesota in 2018 with a total pay of $26.2 million for the year.
This wouldn’t necessarily be outrageous compensation if Xcel Energy were a private company competing for your businesses in a free market, but the fact that Xcel customers are literally forced by the government to buy their electricity from the government-approved monopoly makes this level of compensation unconscionable.
Why does the Xcel CEO get paid so much? According to the Star Tribune:
“Fowke’s annual bonus is based on five factors: employee safety, public safety (based on gas emergency response), electric-system reliability, customer satisfaction and operations and maintenance growth.
Since 2004, Minneapolis-based Xcel has included environmental goals as part of its executive compensation plan, and it’s had employee and public safety goals for more than 20 years.
Its results-based metrics are aimed to help the company achieve its long-term goals of reducing carbon emissions 80% by 2030 and achieving 100% carbon-free electricity by 2050.”
The first paragraph sounds nice, but it is the second and third paragraphs that really tell the story of why Xcel’s CEO is raking in cash, and it’s all about the Benjamin’s, baby.
We know that building wind and solar is incredibly profitable for utility companies because it allows them to increase their guaranteed profits. In fact, Xcel’s profits have increased by more than $700 million in 2018, compared to 2005, the first year Xcel was required to start using renewable energy and the year after Xcel started incorporating environmental goals as part of their executive compensation plan.
The increase in renewable energy use has been very good for Xcel’s profits, and Xcel wants to keep the gravy train moving for the foreseeable future, which is why the company helped write Governor Walz’s bill for 100 percent carbon free energy by 2050.
The reason Xcel’s goals to reduce carbon dioxide emissions by 80 percent below 2005 levels by 2030 are so lucrative is because it allows them to shut down their coal plants early and build wind, solar, and natural gas, enough natural gas to power the entire grid in case the sun isn’t shining or the wind isn’t blowing, thereby padding that sweet, sweet rate base.
Unfortunately, the money to pay for all these CEO bonuses had to come from somewhere, and that somewhere was your wallet. According to Energy Information Administration data, Minnesota families paid more for their electricity in 2018 than ever before, and this trend will only increase if Xcel is allowed to shut down their coal-fired power plants 10 years early, as they are hoping to do.
The fact that CEO’s are allowed to make $26.2 million off the backs of customers who are forced by the government to buy their electricity from the government-approved monopoly is entirely unjust. Some other states allow residential customers to choose who they want to purchase their electricity from, and Minnesota should seriously consider following suit.