2021 Rate Filing
On May 3, 2021, MGE filed an application with our state regulatory body, the Public Service Commission of Wisconsin (PSCW), to adjust electric and natural gas rates in 2022 and 2023. The PSCW will review the proposal as part of a public, transparent and participatory process to set rates for the next two years. A hearing to solicit public comments will be held later this year.
Below is information about MGE’s distribution system, our energy future and our proposal for gas and electric rates.
Our Community Grid
MGE continues to add clean energy projects to serve all of our customers cost-effectively. A cleaner, smarter grid is part of our strategy for working together with our customers to manage our collective use of energy and to achieve our goal of net-zero carbon electricity by 2050.
Our community and all of our customers depend on and benefit from a safe, reliable and secure electric grid. MGE is transforming our community grid to create a smarter, more dynamic and resilient grid to better serve all of our customers.
We’re growing our use of renewable energy, launching innovative programs and new technologies for a more integrated grid that delivers greater efficiency and value. All customers share in the costs of building, maintaining and operating our grid. A cleaner, smarter grid is part of our strategy for working together with our customers to manage our collective use of energy and to achieve our goal of net-zero carbon electricity by 2050.
Rate Proposal Overview
MGE has been able to contain and to manage costs as we continue to transform how we maintain safe, reliable, affordable and increasingly sustainable energy.
In addition to cost containment efforts, the cost of the fuel that we use to generate electricity has been decreasing as our new renewable generation projects come online. Renewable energy carries no fuel costs, reducing price volatility for our customers. We continue to grow our use of cost-effective, carbon-free energy as indicated by the map of our recent clean energy projects.
Our electric rate proposal: MGE is proposing a 5.9%* electric rate increase in 2022 but seeking to credit 2020 fuel costs in 2022, reducing the overall increase to 5.1%. Customers receive a fuel credit when actual fuel costs are lower than originally forecasted for a given year. If approved, a typical residential customer using 500 kilowatt-hours a month would see a bill increase of about $4.91 per month.
This increase covers costs associated with the construction of the Badger Hollow Solar Farm, which is expected online this summer. All customers will benefit from this cost-effective solar project. There are no fuel costs associated with solar energy, which helps to manage customer costs over time. This project and MGE’s other clean energy projects also advance our goal of net-zero carbon emissions, which we know is a priority for many of our customers.
Our natural gas rate proposal: MGE is proposing a 3% increase in natural gas rates for 2022 and a 1.6% increase in 2023. If approved, the typical residential natural gas bill, reflecting 715 therms used annually, would see an annual increase in 2022 of about $17.75, or $1.48 per month, if broken down monthly. In 2023, the typical MGE residential natural gas bill would see an increase of nearly $8.30 for the year, or about $0.69 per month. The primary reasons for the gas increase are infrastructure costs to maintain a safe and dependable system and technology improvements.
Working with Our Customers
MGE was one of the first utilities to commit to net-zero carbon electricity by 2050. We’re working toward this ambitious goal through:
- Decarbonization of our electricity generation and growth in our use of renewable energy.
- Electrification of transportation and other end uses. Transportation is a leading contributor of greenhouse gas emissions.
- Customer engagement in energy efficiency.
Saving energy and reducing your energy use helps to manage and to control costs, both individually and collectively over time. By managing our energy use through simple strategies and new technologies, we can reduce our environmental footprint and manage costs to all customers over time.
to learn more about our energy future and to find energy-saving tips.
*Our proposal includes fuel costs that will be updated later in 2021. Adjustments to fuel costs, when they are updated in the fall, could impact the actual total amount of the rate filing and the impact to customers.