MGE reduces electric rates again
Lower-than-expected natural gas prices have caused electric rates to fall.
MGE has reduced electric rates for the second time this year due to lower natural gas prices.
A fuel cost credit of $0.00454 per kWh went into effect May 26, saving MGE customers $9.2 million this year. In March, a fuel cost credit of $0.00069 went into effect.
MGE works to control costs and operate efficiently, especially during this time of volatile fuel prices and when utilities are building infrastructure.
Tied to natural gas prices
Lower-than-predicted prices for natural gas led to both rate reductions. The new rates better reflect actual fuel costs so far this year.
The Public Service Commission of Wisconsin approved MGE's 2006 rates in late 2005 when natural gas prices had peaked over $15 a dekatherm. Since then natural gas prices have fallen into the $6 to $7 range.
The state commission will review MGE's fuel costs again in September, and the electric rates may be adjusted—either up or down—based on natural gas prices predicted for the fall.
Natural gas prices have been extremely volatile based on weather, hurricanes and global energy markets. Fuel rate cases provide flexibility to react to the gas prices.
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