The Minnesota Public Utilities Commission on Jan. 8 established a procedure to determine goals and metrics for Xcel Energy Inc.’s performance-based rates. The commission adopted the Office of Attorney General’s recommendation which outlines a “goals-outcomes-metrics process” as an effective method to gather stakeholder input and develop performance metrics. The possible outcomes identified include affordability, reliability, service qualify, customer satisfaction, and environmental performance. The initiative stems from Xcel Energy’s multi-year rate plan filed in 2017. Performance-based rates adjust utility revenues based on their measurable performance, and they have been gaining popularity nationwide as grid technology keeps evolving.

The office outlined a multi-step approach with an initial focus on four steps that seek to articulate goals, identify desired outcomes, and arrive at the metrics. The commission said that the Great Plains Institute will be tasked with conducting workshops and completing summary reports. The agency expects the process to be finalized in about nine months.

Xcel is currently operating under a four-year rate plan through 2019. In its last rate case, the company filed new performance metrics pertaining to “customer satisfaction, customer choice, environmental stewardship, and customer outage experience.” The commission decided that the proposal warrants a separate proceeding to evaluate the metrics and explore the possibility of tying incentives or penalties to performance under those metrics.