April 1, 2010: Residential Ratepayers Subsidize Industrial Customers

  • April 1, 2010
Leah Steinberg

For Immediate Release: April 1, 2010

Residential Ratepayers Will Likely Subsidize Industrial Customers

MADISON – The Citizens Utility Board is sorely disappointed by yesterday’s decision by the Public Service Commission, which will allow Wisconsin Power & Light to give discounts to industrial customers that will likely be subsidized by residential customers and others.

Wisconsin Power & Light, a utility subsidiary of Alliant Energy, applied with the PSC on November 13, 2009 for permission to offer an “economic development rate” that would provide certain large industrial customers with a discount on electricity service.

CUB has long been opposed to rates with discounts, because they usually force other customers to pay for the discount. Indeed, the laws that regulate utility service in Wisconsin prohibit utilities from charging rates that provide discounts to one customer that are subsidized by other customers. CUB noted many of these concerns in correspondence to the PSC dated February 17 and March 16, 2010.

Although PSC Chairperson Eric Callisto and Commissioner Mark Meyer approved the discounted rates, Commissioner Lauren Azar voted against them, noting that subsidies for certain industrial customers may cause higher rates for residential and commercial customers.

“Today’s decision by the PSC ignores long standing laws that protect residential customers from subsidizing large, politically powerful companies,” said CUB executive director Charlie Higley. “The job of the PSC is to set electric rates that are fair, just, and reasonable, and in making this decision, the PSC has failed miserably at doing its job.”