Minnesota Attorney General Lori Swanson today said she has asked the state Public Utilities Commission to deny a rate increase requested by Duluth-based Minnesota Power.
Minnesota Power in November filed a request with the PUC to raise rates on its customers by a combined $80 million, or about 20 percent.
The utility also has asked to begin charging $73 million of the increase starting Jan. 1 on an interim basis while the PUC determines if the permanent increase is warranted.
The proposed increase would be on top of a recent $20.4 million rate hike approved by the state and already being charged by Minnesota Power.
The requested increase would raise the average residential customer's monthly bill by about $13.
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Swanson said the PUC has the authority to deny the increase, and she listed the region's high level of unemployment, the downturn in the regional economy and the onslaught of winter as reasons customers of Minnesota Power should not have to pay more.
"As we enter the winter heating season, our citizens are struggling with a tough economy and high unemployment rates. The company filed this $73 million rate increase request before the ink even dried on its last $20 million," Swanson said in a written statement. "The PUC should not allow the company to jack up rates on individuals and small businesses during these troubled financial times, before it even proves the rates are necessary."
The PUC will hold a hearing on the interim rate increase Tuesday in St. Paul.
Minnesota Power officials say much of the proposed increase, $46 million, is going to upgrade pollution controls and performance at the Boswell Energy Center in Cohasset. The upgrades, first announced in 2006, would cut air pollution at the coal-burning powerplant by an estimated 80-90 percent.
The utility also has plans to add more wind-generated electricity and upgrade transmission systems.
Amy Rutledge, Minnesota Power spokeswoman, said the utility realizes the tough economic situation and that any rates increase is unpopular, but that the benefits balance the cost.
"We certainly value the extensive process the people at the PUC go through to make sure our rates are fair, and that includes the opportunity for anyone to comment," Rutledge said. "It also gives us a chance to show folks what the benefits are behind the investments we're making."
