WPS requests 9.4 percent electric rate hike

Wisconsin Public Service Corp. asked state regulators Friday to increase electric and natural gas distribution rates for 2016.

The Green Bay-based utility said it wants to raise electric rates 9.4 percent and natural gas rates 2.5 percent.

The state Public Service Commission rarely approves rate requests at the levels applied for. For example, WPS asked to increase electric rates 8 percent and reduce natural gas distribution rates 0.5 percent for 2015. The Public Service Commission instead mandated a 2.52 percent increase in overall electric rates and a 4.3 percent decrease in natural gas distribution rates. That was the largest electric rate increase and largest natural gas decrease in seven years.

The utility said a typical customer's electric bill would increase $7.62 per month and the natural gas bill would be $1.54 more per month if approved as requested. A typical residential customer uses 600 kilowatt-hours of electricity per month and 800 therms of natural gas per year.

Rate requests use data that is six months to a year old by the time the case is filed. A lot can change in the interim. Fuel prices can change, the economy can improve or slow down, and weather can be favorable for sales, such as winter 2013-14, or not, such as winter 2011-12. All those factors affect assumptions in a rate case and the Public Service Commission decision can reflect those changes.

WPS said the basis for its electric rate request included construction costs for pollution controls at its Weston 3 power plant near Wausau, transmission costs, burying of electric distribution lines, mostly in Northern Wisconsin, upgrades to the Fox Energy Center in Wrightstown, customer service improvements and inflation.

Overall electric rates did not increase in 2009, 2010 and 2013. They increased 0.61 percent in 2011, 0.85 percent in 2012 and 2.52 percent this year. Rates decreased 1.31 percent in 2014.

Natural gas distribution rates decreased 0.44 percent in 2009, 2.22 percent in 2011, 1.98 percent in 2012 and 4.3 percent this year. They increased 3.08 percent in 2010 and 1.23 percent in 2014.

Natural gas distribution costs do not include the price of natural gas itself, which is passed through to customers.

The Public Service Commission will hold public hearings on the request before making a final decision later in the year.

Wisconsin Public Service Corp. provides service to 445,000 electric and 323,000 natural gas customers in Northeastern and north-central Wisconsin and Michigan's Upper Peninsula. Electric operations account for 80 percent of WPS's revenues, with natural gas operations making up the remainder.

WPS is a subsidiary of Integrys Energy Group of Chicago. Integrys announced it agreed to be acquired by We Energies of Milwaukee in a $9.1 billion deal expected to close this summer.

— rryman@greenbaypressgazette.com and follow him on Twitter @RichRymanPG or on Facebook at Richard Ryman-Press-Gazette. Contact him at (920) 431-8342.