Madison: State Senator Tim Carpenter (D-Milwaukee) has called on the Public Service Commission to protect residential customers and deny the 5% rate increase sought by We Energies, the Milwaukee-based utility. Senator Carpenter made his comments after attending a recent PSC public hearing regarding We Energies’ requested rate increase.
“The Public Service Commission has frozen or even lowered utility rates around Wisconsin in Green Bay and Madison. However, in Milwaukee, We Energies is petitioning the PSC to allow an increase in utility rates that would cause customers’ utility bills to increase by 5% – $138 million – starting this January. The PSC should deny We Energies’ 5% rate increase request,” said Carpenter.
“Seniors on fixed incomes and middle class families are not able to afford their utility bills increasing by 5%. While the salary of We Energies’ CEO increased over 10% to $11.3 million dollars last year, Social Security for seniors is only increasing 1.7% next year. Shareholder returns on equity investment in utilities in Wisconsin has been around 10%, drastically higher than our seniors and middle class families receive on their savings accounts. Elsewhere in our country, utility investment returns have dropped from double digits. The Public Service Commission should not continue to needlessly give away generous investment returns when the cost is higher residential rate increases,” said Carpenter.
We Energies (whose parent company has just reported net income of $156.1 million in the third quarter – a 20% increase) has stated that its request for the 5% rate increase stems in large part due to $180 million in construction cost overruns of the Oak Creek coal-fired power plants. “The PSC should seriously consider the propriety or necessity of We Energies passing such costs onto residential utility customers; it appears that it would be fairer for the costs of such business risks to be shouldered by the utilities’ equity investors, not the ratepayers,” said Carpenter.