Settlements Approved: Give and Take Lead to Good Deals for Customers

We’ve got good news for customers of utilities based in Madison, thanks to settlements CUB and other stakeholders have negotiated with utilities.

In August, state regulators unanimously approved a settlement that will keep rates stable for the next two years for Wisconsin Power and Light, the Alliant Energy utility based in Madison.

Then, just last week, the PSC voted to endorse a settlement for Madison Gas and Electric Co. customers. This settlement will cut rates by about 2%, or $7 million, in 2019 and keep rates unchanged from 2019 to 2020.

CUB, which filed these comments in support of the deal, wasn’t the only group to sign on to the deal. MG&E brought together a diverse group of stakeholders including UW-Madison, Airgas, the Wisconsin Industrial Energy Group, Renew Wisconsin and Clean Wisconsin. Plus, of course, CUB, the independent voice of small business and residential customers.

The settlements show that the new law enacted by the Legislature is producing results for customers.

The settlements law encourages utilities to negotiate their rate plans for the coming year with stakeholder groups and then present a settlement package to the PSC. Compared with a typical rate case, the new process shortens the review time and limits the scope of the audit and analysis performed by the PSC staff.

You may recall that CUB raised concerns about the Settlements Law when it was being considered in the Legislature. Our chief concern: The process would move too quickly, and customer advocates wouldn’t have access to all the information they needed to assess whether a settlement was in the public interest.

As it turned out, negotiations with both Alliant and MG&E showed that the settlements law could work – IF the utilities provide plenty of information, and begin negotiating with us well in advance of any deadlines written into the new law, as both Alliant and MG&E did.

As we said in our comments: “Time, information, and compromise are essential for an equitable rate case settlement. All of these elements were present in the negotiation process, resulting in a Settlement Agreement that is favorable for all of MGE’s ratepayers.”

We may not like every settlement that a given utility will proposed, but there’s a lot to like about this deal, including bringing down prices for customers but also MG&E’s willingness to work with CUB on some new innovative pilot rate programs that could be unveiled in the coming months. Here’s a link to our comments in support.