Superior Water Light & Power Rate Case for 2025 — 5820-UR-117
In March 2024, Superior Water Light & Power (SWLP) filed an application to increase electric, natural gas and water utility rates for customers in far northwestern Wisconsin. The increase would take effect in January 2025, if approved by the Public Service Commission. Superior is a subsidiary of Allete, a Minnesota utility company.
SWLP is seeking increases of:
Electric: $2.03 million, 2.17% overall increase
• Residential increase: 8.4%
• Small Business increase: 8.4%
Natural gas: $3.44 million, 17.11% overall increase
• Residential increase: 23.1%
• Small Business increase: 12.6%
Water: $1.82 million, a 17.97% overall increase
• Residential increase: 18.7%
• Multi-Family increase: 14.3%
• Small Business increase: 18%
Who’s Affected: 15,000 electric customers, 13,000 natural gas customers, 10,000 water customers
Drivers for the increase: The requested increases are tied to infrastructure projects in Superior, including municipal road reconstruction.
CUB Priorities: Utility profits, overruns on spending on recent projects, and affordability and household utility burden for residents in Superior.
RETURN ON EQUITY / UTILITY PROFITS
On profits, the utility is seeking to retain its return on equity of 10.0%, after having seen it drop from 10.4% in the last case two years ago. CUB testifies that further savings for customers are likely if the PSC, consistent with its practice in recent years, reduces the return on equity to 9.5%. CUB also proposes that returns be calculated on a smaller share of the utility’s revenues. CUB’s proposal would save SWLP’s customers more than $500,000 in 2025.
• Wisconsin investor-owned utilities already get the fifth highest profit rates in the country, forcing customers to shoulder utility bills that are too high.
CUB regulatory strategist Steve Kihm testified, “The greater the concern that the Commission has with the ability of SWLP’s customers to absorb rate increases, the more it could reduce the ROE for SWLP.”
AFFORDABILITY
CUB testimony highlighted the magnitude of the proposed increases for residential and small business customers and underscored the affordability challenge these increases represent for a community that is already struggling economically. Utility burden measures the percentage of monthly income a household spends on utility bills, and experts consider a utility burden above 6% to be high. CUB’s analysis found that neighborhoods in SWLP’s territory would see an increase in the number of households with utility burdens over 10% of income.
CUB regulatory affairs director Corey Singletary testified, “With respect to electric rates, while seemingly small when compared to revenue adjustments approved by this Commission in recent years, SWLP’s request would add to an already alarming trend which has seen the Company’s electricity rates grow faster than any other major IOU (investor-owned utility) in Wisconsin, particularly for residential customers.”
PSC AUDIT
The PSC staff, after auditing the utility’s requested increase, recommended the regulators trim down SWLP’s rate increases to:
Electric: $1.23 million, or 1.29%
Natural gas: $2.91 million, or 14.46%
Water: $1.1 million, or 10.85%
EXPECTED TIMELINE
• March: Application Filed
• Aug 5: CUB experts, PSC staff weigh in
Steve Kihm testimony
Corey Singletary testimony
• Sept. 9: Public Hearing in Superior and on Zoom
• Sept. 12: Last Day to file written public comments
• September: CUB files legal briefs presenting its positions and responding to other parties’ briefs
• October/November: PSC Open Meeting to decide the case
• November/December: PSC Written Decision to be issued
FIND OUT MORE
• See the filings in the case at the PSC here.
• See the public hearing notice here.
HAVE YOUR SAY
• Provide a comment during the public hearing, either in person or over Zoom, at 2 p.m. and 6 p.m. Monday, Sept. 9.
Attend in person in Room 270, Douglas County Courthouse, 1313 Belknap Street, Superior.
Attend via Zoom at https://us02web.zoom.us/my/pschearings or by calling (312) 626-6799, using Meeting ID 809 513 2930.
OR
• Submit a written comment on the PSC website by Sept. 12, 2024.
