Because of lower taxes, Minnesota Power customers to get modest refund
DULUTH — The Minnesota Public Utilities Commission ordered several of the state's utility companies to return $200 million to consumers — including $18.7 million from Duluth-based Minnesota Power.
That's possible thanks to lower corporate tax rates following the 2017 Tax Cut and Jobs Act.
"With respect to each regulated utility, the Commission acted to ensure that each utility's rates
reflect the new, lower federal income tax rates in the cost of providing service," the PUC said in a news release Friday, Aug. 10.
For Minnesota Power customers, the lower federal tax rate has already resulted in a lower rate increase, but Thursday's decision will lead to paybacks for customers, Minnesota Power spokesperson Amy Rutledge explained in an email.
"When final rates go into effect late this year, customers will start receiving a 1.5259% credit on their monthly bill through a new line item, called the tax cut rider, totaling about $10 million a year refund until our next rate case," Rutledge said.
For a $100 power bill, that's about $1.53 returned.
The 2018 refund balance will be returned to customers in "a lump-sum credit" in early 2019, Rutledge said.
Minnesota Power recommended the payback to the PUC, Rutledge said.
The federal tax cut "is resulting in savings and we are passing on those savings to customers," Rutledge said.