Public hearings that could affect a We Energies proposal to raise homeowners’ electricity rates by 18%, and natural gas rates 14% over two years will take place this week. As with previous utility rate hikes, this plan is controversial.
In addition to what homeowners would face, businesses would see hikes in what they pay for electricity and natural gas. The business increases would be smaller, but still a problem for Willie Collier. He owns a seven chair barber shop and salon on Villard Ave. in Milwaukee. Collier says in the roughly 14 years he’s been at that location, his monthly utility bills have nearly doubled.
"Considering I have to run heat, I have electrical things I have to run on a daily. You know, with those two together, it’s a doozy. It’s definitely a doozy. And not only do I have it here in my business, but also in my home," Collier says.
Now, with We Energies coming around with a new plan to increase rates, Collier laments the lack of choice he has for buying power and heat.
“With it being a monopoly the way that it is, it’s very strenuous. We don’t have any choices as to who we can deal with or anything to that matter. At the same time, if they would just be fair, we wouldn’t mind them being a monopoly," Collier says.
We Energies is a regulated monopoly, meaning the Public Service Commission of Wisconsin (PSCW) has to approve rate increases. The commission is already meeting with official parties in the current case.
This week, it’s the public’s opportunity to weigh in—as right now, the estimate is homeowners would pay about another $150 a year for electricity. We Energies spokesperson Brendan Conway says the rate hikes are needed for several reasons—one being to strengthen the electrical system to withstand more frequent severe weather.
“We’ve never said it’s not changing climate. But our focus is on addressing that. A specific statistic that is interesting is, we’ve been tracking what we called significant outages. That’s outages that impact 100,000 customers or more. Since 2020, we’ve had eight of them. In the previous 43 years, we saw six. And so, the plan is how can we lessen that impact as Mother Nature, severe weather is getting stronger?" Conway says.
Conway also says the proposed rate hike is needed as We Energies tries to recover costs from developing installations that use cleaner forms of energy—cleaner than their longtime favorite coal burning.
“Plants that the PSC-W has already approved. And that includes the Paris Solar Energy Center in Kenosha County, the Darien Solar Energy Center in Rock and Walworth County. Both of those are under construction today, and are expected to be in service this year," Conway says.
Conway says a third part of the rate hike plan is to generate money to trim trees near power lines and bury more of the wires.
The Citizens Utility Board of Wisconsin (CUB) is among the groups trying to reduce the size of any rate increase. Executive Director Tom Content says one focus is on reducing We Energies’ proposed profit.
“And the utility’s actually trying to increase its profits. We’ve shown they’ve gotten above average profits for a long time. Our proposal would bring those profits down and save over $125 million over the two years," Content says.
Content says another goal during this rate case is to reduce the amount of money We Energies can make from the upcoming retirement of its older coal-fired power plant in Oak Creek. Years ago, the company borrowed money and raised rates to pay for improvements there. But Content explains the company could now save money by ceasing operation.
“The old Oak Creek plant, which was built way back in the 1950s and 60s, the PSC approved almost $900 million in spending. So it would add the catalytic converters and scrubbers—things that help people’s hearts and lungs if they live near a coal plant. The thought was the plant was going to last a lot longer, and now it's being shut down well before the end of its useful life. The profit schedule lasts as long as the useful life was, which was going into the 2040s," Content says.
We Energies says it’s been "incredibly aggressive" in closing coal plants, in part with the support of environmental and consumer groups.
Whether you want to talk about these more complex utility funding issues, or the simple matter of how the proposed rate hikes would affect your household or business budget, the PSC is taking testimony at public hearings Tuesday, Oct. 1, in Racine and Thursday, Oct. 3, in downtown Milwaukee.
The regulatory agency usually issues a ruling on a rate case before the end of the year.
