February 23, 2009 (FinancialWire) -- Xcel Energy (NYSE: XEL) said it has asked regulators to approve a reduction in electric bills for all classes of customers that would amount to a twenty percent reduction for an average residential customer beginning March 1.

According to Xcel, the request was made to reflect lower natural gas prices and fuel-cost savings from the company's new Hobbs Generating Station. The reduction is about three times the amount of a recent rise in base rates.

Through a series of filings at the Public Utility Commission of Texas, the company is seeking approval to reduce fuel charges on customer bills and to remove a fuel surcharge at the end of February, one month earlier than planned. The surcharge began in April 2008 and was scheduled to end March 31. Together, these changes will drop an average bill of 1,000 kilowatt-hours, starting in March, by $20.02 on an interim basis.

The fuel charges are recovered through a fuel-cost factor that is updated two to three times per year. The company also has asked the PUCT to allow it to change the formula by which the factor is figured to reflect savings from the new Hobbs Generating Station.

Once the proposed permanent fuel-cost factors are adopted by the PUCT and set in place on June 1, the decrease would be slightly less at $15.36 savings for average bills, or a 14 percent decrease from current bills.

Minneapolis-based Xcel Energy is a U.S. electricity and natural gas company with regulated operations in eight Western and Midwestern states. Xcel Energy provides a portfolio of energy-related products and services to 3.3 million electricity customers and 1.8 million natural gas customers through its regulated operating companies.

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