Energy companies pass cost increases, not profits, on to the customer

For those of us living in the real world, when the price of something goes up, we have to factor it into our budget. We have to deal with the stress of it. We cannot just flip a switch and increase our cash flow.

When our heating bill goes through the ceiling, we can’t go into work and say, “Boss, I need an extra $150 this month, my heating bill went up.” The boss would get a good laugh and then tell you to either work more hours or get a second job.

But this is just the type of world our utility companies live in. When the price of gas from their “supplies” goes up, they pass it all on to us. I understand this to a certain extent, yet they, the utility company, absorb none of the increases. This causes much hardship to poor people.

For instance, in just a one-month’s billing cycle, CenterPoint Energy increased the cost of natural gas over 35 percent. So a person using the same amount of gas each month would see an average $200 a month bill jump to over $270 a month.

The utility companies claim to be victims in all of this just as we the customers are. But that does not add up because we, the customers, do not have $13 million lying around to pay our top five executives.

In 2013, CenterPoint Energy President and CEO David McClanahan was paid $5,172,341. The next four top-paid executives at CenterPoint got $2.57 million, $2 million, $1.9 million and $1.77 million — over $13 million for just five employees for just one year’s work. If they are not making a profit off these rate increases, where then is all this profit coming from?

Xcel Energy has enough cash lying around to pay millions to have a hockey arena in downtown St. Paul named after them. All this cash — millions of extra dollars that our local utility companies have — yet they cannot absorb any of these natural gas “supplier” rate increases.

It is criminal! You have people eating only ramen noodles and cat food so they can keep the heat on, and these guys pay themselves millions of dollars and buy the naming rights for sports arenas.

Good thing there are governmental checks and balances in all of this, stopping the top five executives at CenterPoint Energy from making over $100 million each year. When things go up in price, we should all have to deal with the pain of it, not just some of us.

 

Frank Erickson lives in Minneapolis.