Madison Gas & Electric, Xcel Energy and Alliant Energy are looking to increase their electric and gas rates for 2024 and 2025, according to a Nov. 9 Public Service Commission of Wisconsin meeting.
As decided in a Nov. 3 PSC meeting, MG&E’s electricity prices will increase by an extra $8.76 per month for its average residential customer, starting on Jan. 1, 2024. Gas prices will also increase by $2.31 monthly for its average residential customer, according to PSC Communications Director Meghan Sovey.
Xcel Energy prices will increase for its average residential customer by $0.61 monthly for energy and by $2.39 for gas. For its average residential customer, Alliant Energy prices will increase by $6.74 for energy and by $3.98 for gas price. The average Alliant Energy customer will also see an $8.02 increase for electricity and a $0.05 increase for gas for the expected average usage in 2025, according to Sovey. Xcel Energy and Alliant Energy price increases were decided in a Nov. 9 PSC meeting.
Sovey said before the current adjustments were approved, the utility companies proposed greater changes to electric and natural gas rates.
These increases are just preliminary estimates for an increase in cost, as the official costs are not yet finalized, and could still change based on the PSC’s review, Sovey said.
The PSC sets the rates for utility prices in Wisconsin, but utility companies can request an increase in prices. These prices are approved only if the PSC deems them reasonable for the company expenses to be paid and also be cheap enough for consumers, professor of law emeritus at University of Wisconsin Peter Carstensen said.
There is also a partially state-funded organization in Wisconsin that argues in favor of utility ratepayers, which is called the Citizens Utility Board, according to Carstensen.
“CUB is very likely to say ‘that’s too high a rate,’ and the utility company will say ‘that’s too low a rate,’” Carstensen said. “If [the utility companies and the CUB] are yelling like that, I figure it’s probably a reasonable rate cost … if they’re both saying those things, then I think okay, the [PSC] has reached a reasonable conclusion.”
Other states are also taken into account. If other states are not increasing utility prices, the PSC is less likely to approve an increase in prices, since increase proposals confined to Wisconsin may signal poor management of the utility company, according to Carstensen.
The reason the PSC has the power to regulate prices is because energy companies in Wisconsin are essentially monopolies. Other states have had a more competitive system, but have usually failed, according to Carstensen.
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The changes come after MG&E and Alliant Energy submitted requests to the PSC to alter net metering rates. The change would have impacted how much money a household is paid when they have excess power to sell back to the energy grid, created mainly by solar panels, Carstensen said.
The PSC rejected both proposals, citing a lack of clarity for consumers, according to The Cap Times.
“One of the things that really worries [power companies], of course, is the development of better battery systems,” Carstensen said. “There’s a possibility down the road, take my house [for example], I would probably have to add some more panels and a good battery system — but then I could basically go off the grid.’”
Editor’s Note: This article has been updated to reflect that the adjusted utility rates were approved by the Public Service Commission, and to include the PSC’s decision to reject proposals to alter net metering rates for MG&E and Alliant Energy.
