Friday, May 27, 2011

Alternative rate request calls for zero increase for 2012

Posted by Bob Zahn

We filed a rate proposal with the Public Service Commission of Wisconsin (PSCW) on May 27, which calls for no increase in rates for 2012. If approved, base rates would stay the same for 2012, and we would file a regular rate case next year for new rates in 2013. This alternative approach is being proposed in response to the fragile economic recovery expected to continue through next year.

With this alternative approach, we would absorb costs in 2012 with the expectation that the economy will continue to strengthen into 2013. The projected rise in fuel costs is expected to be offset by returning proceeds obtained from the our successful settlement with the Department of Energy over spent nuclear fuel.

While economic conditions are slowly improving, both residential and business customers continue to feel the impact of the challenging economy of the last few years. A weak housing market, higher costs for groceries and increasing gasoline prices continue to contribute to difficult economic circumstances for customers.

Delaying a rate increase for 2012 may benefit customers, but we still will need to recover investments already approved by the PSCW over the past several years to strengthen reliability, comply with changing environmental requirements and meet the state’s renewable energy mandate.

If the PSCW determines that any part of this approach is not acceptable, we would have to withdraw the plan for no base rate increase in 2012 and then proceed with a traditional, comprehensive base rate request.

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