What You Need to Know About Wisconsin’s Utility Rate Increases

Wisconsin utilities are proposing gas and electric rate increases in 2024 in order to help offset the investment in renewable and low-carbon power plant projects in the state.

Large utility companies are proposing hikes, citing costs in construction of new solar, gas, wind, and battery storage facilities. Some utilities are proposing rate increases of up to 7.3% total increases.

For the average homeowner, rising utility rates will make it more expensive to maintain comfortable households, especially during cold Wisconsin winters when heating needs are high. Even a 3% increase in utility rates can add about $4/month or $50/year to your utility bill. Over time, and with compounding rate increases, these bill increases can significantly impact your utility payment.

Read more about Wisconsin utility rate increases from Milwaukee Journal Sentinel.

Image courtesy of Badger Institute

The story is similar for businesses. Energy-intensive industries, like manufacturing or those that depend heavily on refrigeration, can face steeper increases due to higher usage. Small businesses, which operate on tighter margins, can expect to experience a rise in overheads. Additionally, rising utility costs could affect consumer prices as businesses may pass these increases on to utility customers.

Both groups will feel the continued effects of longer-term shifts in utility costs. Although the electric and gas rate increases aim to fund renewable energy projects that can reduce future costs, projections don’t show rates decreasing by the same amount.

Rising rates are not only affecting just Wisconsin, but also have been increasing in Ohio, as well as significant increases in Oregon.

Investing in your own sustainable energy resources keeps your home and wallet padded against the increasing costs, all while producing clean, sustainable energy from your own home.

What Are Utility Rate Increases?

Utility rate increases refer to the prices that utility customers pay for essential services like electricity, and natural gas. Utility companies regulate these rates, and providers may increase rates due to factors like infrastructure upgrades, coal and gas purchases, and rising global resource pricing.

The Wisconsin Public Service Commission (PSCW) regulates Wisconsin utility rates. This organization approves rate changes to assure fairness and equality for customers and utility companies. 

They review requests from utility companies and hold public hearings to gather public comments and approve, modify, or deny rate requests. Finally, the PSCW decides how rates are structured, how much typical customer groups (commercial, residential, etc.) should be charged. By regulating utility rates, the PSCW aims to ensure that prices are fair while leaving enough overhead for the utility companies to provide reliable service and invest in future projects.

Read more about voicing opinions on rate increases from the Wisconsin Citizens Utility Board.

Why Are Utility Rates Increasing?

Like many other states, Wisconsin’s’ utility infrastructure is aging and requires existing system support as well as money for new expansion. Utility companies need to upgrade or replace power lines, transformers, and substations, especially when dealing with Wisconsin’s cold climate. Every time snow or ice downs a power line, utility companies need money for repairs and rebuilds. Although your utility bill factors in some of this cost, the small increase per person may not be enough to sustain the infrastructure and maintenance.

In addition, as utility companies integrate more renewable energy projects all over the state, grid technology and upkeep incur costs. Utility-scale solar, wind, and geothermal projects are popping up all over the U.S. and the initial costs are generally not cheap. Experts do not project that utility companies will remove short-term customer rate increases after project completion to fund these projects.

Even though the transition to renewables is growing, Wisconsin still relies on fossil fuels for a large part of its energy demands. Utility companies still need to consider the price of fossil fuel sources will change in price based on global prices.

How Do Rate Increases Affect Wisconsin Homes and Businesses?

Homeowners

The rise of utility costs directly impacts monthly utility bills, especially for single-family homeowners. Customers in Wisconsin often face higher heating bills in winter due to the increase in heating demand, leaving spikes in cost over the winter.

Costs are projected to rise for the average homeowner between $10 and $11 per month in 2025 and between $7 and $8 in 2026, as reported by Wisconsin Public Radio. 

Renters

Renters are in a unique position because they typically have less direct control over the energy use of their living spaces. Rising utility costs unevenly impact renters who live in older, less energy-efficient units where landlords may not prioritize upgrades. Also, renters generally have less flexibility to install their own energy-saving systems such as high efficiency thermostats, which can make utility bills a large portion of their monthly expenses.

Businesses

Higher utility costs increase the working expenses for Wisconsin businesses, especially those with high power needs such as manufacturing, refrigeration, or food services. Increasing utility costs for businesses can raise the overhead costs, which can then be passed on to consumers as higher prices. Small businesses especially may find it harder to absorb these rising costs.

What Can You Do to Lower the Impact of Bill Increases?

One great way to mitigate the impact of utility rate increases is to protect your home against energy loss. We have extreme temperature shifts in Wisconsin, so insulation is key. Everything from putting plastic on your glass, blankets under drafty doors in the winter, or keeping your shades drawn in the summer helps to keep your home cool and comfortable while decreasing energy loss. 

Another great way to save energy is by investing in energy-conscious appliances. High-efficiency dishwashers, lightbulbs, and ovens can all reduce wasted energy as well. 

However, the best way to severely decrease your electricity bill is a combination small changes combined with rooftop solar. Replacing gas appliances for an electric version, maintaining home energy insulation, and keeping an eye on energy use all while using clean, sustainable energy your own home provides is an outstanding way to protect yourself against rising utility rates. 

Image courtesy of Mix108

Many utility providers in Wisconsin subscribe to net metering policies for your solar. This is often beneficial to a homeowner who is producing their own energy with solar.

The Future of Utility Rates in Wisconsin

As Wisconsin’s utility companies propose rate hikes, these increases are likely to become more frequent. Driven by the need to fund infrastructure projects, meet new and existing regulations, and investing in renewable energy sources will be a major source of cost for utility companies not only in Wisconsin, but all over the nation as well.

Current proposals suggest average rate increases of 3% annually over the next few years, which could develop into a long-term trend.

Conclusion

Utility costs in Wisconsin will likely continue to fluctuate as the energy landscape evolves, so staying informed and proactive in your local political system is essential to state-wide change.

Stay informed on what is happening in Wisconsin power news. Follow updates from your utility provider, speak with renewable energy companies, take advantage of available incentives, and manage energy usage to make sure you can be as sustainable as possible.

By making even small changes in energy use, Wisconsin can make a positive impact on its monthly bills and contribute to the broader goal of a resilient and sustainable energy future.

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