Electric meter. (CC0 Public Domain).

Customers of New Energies and Wisconsin Public Service will pay more for electricity in 2025 and 2026, after Public Service Commission of Wisconsin approved rate increases for both utilities on Thursday.

The utilities, both owned by WEC Energy Group, applied to increase rates in April, citing the need to step up forestry efforts to ensure the reliability and costs of building renewable energy and natural gas facilities.

We Energies’ request sparked reactions that led to customers protesting the proposed rate hike in downtown Milwaukee last month. The company has already increased fares in 2023 and 2024.

At Thursday’s meeting, the chairman of the commission Summer Strand said the commission sought to balance the need for safe, reliable and environmentally responsible utility service with affordability.

“My approach to these rate cases is measured and seeks to maintain stability and balance through a fair, gradualist approach,” she said. “Rate shocks and big changes in either direction have a significant impact on all parties.”

Strand also said she was “disappointed” that WEC Energy Group partially attributed the need for a rate increase to “disadvantaged communities struggling to pay their bills” and the company’s partnership with unions.

“We found this unfair, as the union partnership was entered into voluntarily and provides many other benefits to companies, and (Low Income Forgiveness Tool) actually provides the applicant with income they would otherwise not collect,” she said.

In the case of We Energies, the commission approved a general electric rate increase of 8.79 percent over the next two years. PSC says that’s about $188 million less than the utility requested during this period.

It translates to a $7.62 increase in monthly electric bills in 2025 for an average We Energies residential customer and a $9.73 increase in 2026, according to preliminary PSC estimates. That’s a cumulative increase of 12.38 percent over two years, the PSC says.

We Energies asked to raise its profit rate to 10 percent, but the commission opted to keep it unchanged at 9.8 percent.

“It doesn’t seem like an increase is warranted, and given the ranges we’ve seen and all the analysis, a decrease isn’t warranted either,” PSC commissioner. Marcus Hawkins said about the rate of profit.

In the case of Wisconsin Public Service, the commission approved an across-the-board electric rate increase of 7.33 percent over the next two years. PSC says that’s about $134 million less than the utility requested during this period.

It translates to an estimated increase of $7.11 in 2025 in the average residential customer’s monthly electric bill, followed by another average monthly increase of $5.04 in 2026, according to PSC estimates. That’s a cumulative increase of 11.52 percent over the two years, the PSC says.

WPS also asked to increase its profit rate to 10%, but the commission decided to keep it unchanged at 9.8%.

Strand said the commissioners wanted consistency in their decisions on “similar and identical issues” like the rate of profit, both in the We Energies case and the WPS rate.

In a statement, WEC Energy Group spokesperson Brendan Conway said the company appreciates the commission’s vote. He said he supports investments to reduce disruptions, build needed infrastructure, provide jobs and meet federal environmental rules.

“Our typical customers’ bills are below the national average and in line with customers in the Midwest. This will remain true for years to come,” Conway said. “Any customer concerned about their energy bill should contact us immediately to discuss energy assistance and bill payment plans.”

Tom Contentexecutive director of the nonprofit organization Citizens Utility Board of Wisconsinsaid the PSC has adopted a “business as usual approach” at a time when many consumers are struggling with their utility bills. He said more than 1,000 people testified in public or online hearings in both installment cases.

“This was a huge missed opportunity to address the affordability crisis facing customers,” he said. “Customers have already faced energy costs that have risen above inflation and will now continue to rise above inflation for the next two years.”

Content said the profit rate issue was one of those missed opportunities. PSC staff indicated the utilities could each maintain a rate of return of 9.65 percent, down slightly from the 9.8 percent commissioners stuck with.

“We put affordability front and center in this case and asked the PSC to really address this challenge with some bold decisions,” he said. “I didn’t see any bold decisions.”

Listen to the WPR report

Regulators approve electric rate hikes for We Energies, WPS was originally published by Wisconsin Public Radio.