Xcel Energy wants to use new ‘smart meters’ to double your power costs during periods of high demand
Xcel Energy is seeking to use its new fleet of 500,000 “smart meters” to make “time-of-use” (TOU) pricing the default billing option for its customers. These TOU rates will double the cost of electricity for Minnesota families and businesses during periods of high demand while lowering them during periods of lesser demand.
If implemented, Xcel’s electricity prices would double the current rates between 3 p.m. and 8 p.m. on weekdays. Electricity prices in the winter would be about 30 percent cheaper than the summer rates. According to Midwest Energy News, the new pricing scheme is the result of a requirement from the Walz-appointed Minnesota Public Utilities Commission.
Dozens of readers have reached out to me over the last two years, asking me about the likely impact of Xcel Energy’s plan to replace their regular meters with “smart meters.” The main purpose of the “smart meters” is to allow the utility company to ration your electricity.
According to the Xcel Energy filing with the PUC:
Advanced Metering Infrastructure meters allow us to measure electricity in ways that previous meters could not on their own, such as time-of-use energy consumption. Meters will be able to measure both consumption in kilowatt hours and demand in kilowatts.
A key aspest of the new AMI is the ability to remotely reprogram meters, rather
than having to physically be connected to the meter (or replacing the meter
equipment entirely). This functionality will allow the Company to reprogram
meters to roll out new TOU rates in the future.
Energy consumption data for billing purposes can be recorded by AMI meters in
intervals as short as five minutes, but in most cases will be configured for 15-
The first step of this rationing will be TOU pricing to “nudge” people into using electricity during periods of lower demand, and the second step will be locking you out of your thermostat as Xcel did to thousands of customers in Colorado during 90-degree heat in September of 2022.
Unfortunately, TOU pricing will only become more draconian as the state shuts down more dependable coal plants and relies more heavily on wind turbines, solar panels, and battery storage facilities because the pricing mechanisms will inevitably kick in not only during periods of high demand but also during periods of low supply.
Organizations and individuals can now forward comments to Xcel’s time-of-use docket. The Public Utilities Commission has not scheduled any hearings yet, but the utility hopes to begin dynamic pricing in 2025.