Wisconsin’s largest utility company has withdrawn a proposal seeking to increase electricity rates next year to cover rising costs, while Madison Gas and Electric says it is negotiating with customer groups.
In documents filed Friday with the Public Service Commission, We Energies said it would need to collect an additional $25.6 million in 2021, primarily to cover the rising cost of electricity purchased from the Point Beach nuclear power plant.
A spokesman for parent company WEC Energy Group said Monday afternoon the utility had withdrawn the request for “further review by senior management” and would file a new fuel cost plan “in the next several days.”
The initial request would have translated to a rate increase of about 0.88% on average, although large commercial and industrial customers would see an increase of about 1.24%. WEC also requested a 0.13% average rate hike for customers of its subsidiary Wisconsin Public Service Corp.
After a four-year rate freeze, the PSC last year approved a roughly 0.66% hike in 2020 for about 1.1 million We Energies customers based on fixed expenses and projected fuel costs. About 442,000 WPS customers saw rates go up about 1.6%.
Owned and operated by NextEra Energy Resources, the 1,200-megawatt Point Beach Nuclear Plant is Wisconsin’s last operational reactor.
WEC sold the plant for $924 million in 2007 and entered into a contract to purchase its output for the next two decades.
According to filings with the Securities Exchange Commission, WEC will pay $55.82 per megawatt-hour next year for energy from Point Beach, up from $52.66 this year. So far this year, the average wholesale price of electricity in the Midwestern market was a little more than $25.50 per megawatt-hour.
In a settlement for its last rate case, WEC agreed to work with consumer advocates and the PSC to review alternatives to the Point Beach contract.
The withdrawn requests did not mention the COVID-19 pandemic response, which has caused skyrocketing unemployment and falling electricity sales.
Citing the pandemic, Madison-based Alliant Energy last month filed a proposal to freeze rates next year for some 471,500 Wisconsin customers by using fuel and tax savings as well as company funds that would be recovered in future years.
Madison Gas and Electric notified regulators Monday that it is negotiating a rate agreement with customer groups that it plans to file later this year.
MGE spokesman Steve Schultz said in light of the pandemic the company is seeking “a collaborative agreement that provides both short- and long-term benefits to MGE customers.”
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