Protecting the bottom line with rate case interventions
WIEG’s efforts on behalf of large energy users has led to significant results: In 2019, Wisconsin’s investor-owned utilities requested a total increase of $275 million in electric and natural gas rates. WIEG intervened in these rate cases and helped the PSC turn the combined requests for rate increases to an overall rate decrease of $14 million. In the last nine years, investor-owned utility rate hike requests have been reduced by roughly 70% for a total of over $1.2 billion. In addition, WIEG has successfully advocated for new market-based industrial tariffs. In just a few years, these efforts have resulted in savings of more than $120 million versus standard industrial tariffs.
WEPCO rate case/settlement agreement (05-UR-109)
The PSC recently approved WEPCO’s rate case/settlement agreement. The net result is electric increases of 0% to 1% for the largest customers in 2020 and no increase in 2021. There were some changes in the rate design favorable for large customers and notably the adders for both real time rates (RTP and RTMP) were left unchanged. Another key feature is an agreement to securitize $100 million of the remaining book balance of a recently retired coal-fired power plant, which should save customers tens of millions of dollars over time. As background, WEPCO’s base rate case application requested a net increase of $83 million or 2.9% in 2020 and another 2.9% step increase in 2021. Please contact WIEG for more details.
WPSC rate case/settlement agreement (6690-UR-126)
The PSC recently approved WPSC’s rate case/settlement agreement. The net result is electric increases of 1.8% for the largest customers in 2020 and no increase in 2021. There were some changes in the rate design favorable for large customers and notably the interruptible credits were increased in this case. In addition, the adders for both real time rates (RTMP and NLMP) were left unchanged. As background, WPSC requested a net increase of $48.6 million or 4.9% for electric rates in 2020 and another step increase of 4.9% in 2021. Please contact WIEG for more details.
NSPW rate case/settlement agreement (4220-UR-124)
The PSC recently approved NSPW’s settlement agreement proposal for a two-year base electric rate freeze and a 4.6% natural gas decrease. In other words, there would be no change to electric base rates through December 31, 2021. The rate case/settlement proposal was a favorable end result for large companies. The fuel portion of this rate case results in a net rate decrease with a fuel credit of $0.00077/kWh in 2020.
WPL rate case/settlement agreement (6680-UR-121)
In late 2018, the Commission approved WPL’s settlement agreement/rate case using the framework of Act 136, the new settlement law. The settlement agreement established a two-year rate freeze with the potential for flat rates past 2020. WPL is holding its rates flat through 2020 at the same time the utility is bringing on-line the 716 MW natural gas-fired West Riverside plant. Savings from the federal tax cut and reductions in operating costs are among the reasons WPL was able to enact a rate freeze. The settlement agreement was a product of negotiations between WPL, WIEG and CUB.
MGE rate case/settlement agreement (3270-UR-122)
MGE rate case/settlement agreement reduced electric rates in 2019 by 2.24% and then frozen at that level in 2020. The rate case settlement reflected the continuing impact of the federal tax cut approved in late 2017 as well as declining fuel costs. The settlement resulted from negotiations with consumer groups, including WIEG.
Other regulatory initiatives include:
WIEG successfully sought an incremental load Real Time Market Pricing (RTMP) tariff for We Energies’ customers. Following this win, WIEG successfully worked for the adoption of a similar tariff (New Load Market Pricing, or NLMP) for both WPSC and WPL customers.
WIEG also worked with WPSC and WPL to develop nominated load real time tariffs. WIEG negotiated changes to a WPSC tariff that is also called RTMP. Under the revised RTMP tariff, customers pay a $5.50 per MWh adder, but then pay day-ahead market prices.
A similar nominated load real time program was approved for WPL’s largest customers in the summer of 2017. The Day Ahead Market Pricing rider (DAMP) is now in place for qualified customers.
Together, these new tariffs help promote economic growth and development in Wisconsin, without shifting costs to any of the utility’s other customer groups. In just a few years, these efforts have resulted in savings of more than $120 million versus standard industrial tariffs.
Click below to view recent developments regarding these innovative tariffs:
Recent legislative initiatives include:
Industrial RRCs & waste heat recovery/waste heat to power
Industrial customers can create and keep renewable resource credits (RRCs) in Wisconsin, including from waste heat recovery projects. WIEG was instrumental in passing two new laws to help keep energy-intensive operations competitive in Wisconsin (2013 Act 300 and 2017 Act 53). Applications are now available on the PSC’s website.