Wisconsin’s top energy provider is asking the state’s Public Service Commission to increase energy prices by nearly 13% for regular households starting next year, drawing criticism from both state lawmakers and watchdog groups.
Milwaukee-based WE Energies is one of Wisconsin’s top energy providers, providing energy to over a million people across the state.
With these proposed rate increases, the average home would pay an additional $175 for electricity next year, and around $7.71 per month for natural gas.
While the company is proposing double digit rate hikes for regular customers, they are also asking to increase the rate for large corporate energy users by just around 6%, half of what they had originally proposed in April of this year.
Tom Content is Executive Director of the Citizens Utility Board, a nonprofit organization advocating on behalf of consumers for fair utility practices. He says the rate increase is concerning because Wisconsinites are already overpaying for their utilities.
“There’s a study by the Berkeley Business School Energy Institute that found that utility customers are overpaying by billions of dollars every year, and Wisconsin customers are overpaying as part of that. Wisconsin is overpaying even more because profit rates here are higher than the national average,” Content says.
Wisconsin regularly pays significantly more for utilities than both the US average and the Midwest average. That’s according to the Strategic Energy Assessment from the Public Service Commission, which analyzed historical trends in energy consumption up to 2016.
Content also says that a surprise price increase for essential services like electricity will put even more burden on households struggling with inflation.
“In the beginning of this case, WE Energies said that regular customers would see an increase of $5-6 a month, which would be lower than their average increase. Unfortunately they’ve pulled the rug out from under residential customers and small businesses, because now they’ve flipped the script and recommend small customers get a 13% increase from WE Energies, and that big corporations, large manufacturers get (an increase of) just under 7%. That’s another thing that we think is just blatantly unfair,” Content says.
Keviea Guiden is the Energy Burden Organizer for Citizen Action of Wisconsin, a nonprofit community action organization. She adds that these rate increases will disproportionately affect communities of color in Milwaukee due to redlining causing homes in those communities to be less weather-resilient than those in white neighborhoods.
“The homes themselves, they aren’t insulated, they aren’t weatherized. There’s always some kind of creak or opening that makes us pull more energy to keep our houses warm. That means that, if you’re in a grade A neighborhood, you aren’t even paying half of what we’re seeing,” Guiden says.
But Brendan Conway with WE Energies says that these increases are necessary because inflation has raised the costs for green energy projects by the company.
“Three main factors are our capital investments, mainly in renewable energy, then there’s reliability projects, we are making grid hardening projects, burying power lines, strengthening our system against severe weather, then come changes in our wholesale business with other utilities,” Conway says.
The Public Service Commission will hold a public hearing on the rate increase on November 3rd in Milwaukee. They will also accept public comment on the issue through the commission’s website through November 7.
Photo courtesy: Andrey Metelev / UNSPLASH