MGE's Rate Requests for 2026 and 2027
A cleaner, smarter grid is part of our strategy for working together with our customers to achieve our goals of at least an 80% reduction in carbon emissions by 2030 and net-zero carbon electricity by 2050. We're already halfway to our 2030 goal, having reduced carbon emissions about 40% since 2005.
Our community and all of our customers depend on a safe, reliable and secure grid. We continue to invest in this shared resource to ensure all customers benefit from new technologies and from cost-effective sustainable energy sources.
In April, MGE filed an application with the Public Service Commission of Wisconsin (PSCW) to increase electric and natural gas rates in 2026 and 2027.
Proposal for 2026. MGE is proposing a 4.9% increase to overall electric rates and a 2.3% increase in overall natural gas rates.
Proposal for 2027. MGE is proposing a 4.3% increase to overall electric rates and a 2.2% increase to overall natural gas rates from 2026 rates.
Under MGE's proposal:
- The average annual impact on our electric rates from 2018 through 2027 will be about a 2.4% increase.
- The average annual impact on our natural gas rates for the same period will be about a 1.7% increase.
While we recognize any increase is indeed an increase for our customers, both are below the rate of inflation, which is 3.3%, for that period.
Bill impacts
Specific bill impacts under MGE's proposal vary by rate class.
- Residential Electric: If approved, a typical residential customer using 500 kilowatt-hours (kWh) a month would see a bill increase of about $6.96 a month in 2026. In 2027, a typical residential customer would see a bill increase of about $3.75 a month.
- Residential Gas: If approved, the typical residential natural gas bill, reflecting 720 therms used annually, would see a monthly increase of about $1.72 in 2026. In 2027, a typical residential natural gas bill would see a bill increase of about $1.56 a month.
Drivers for the requested increases
We take seriously our responsibility to provide safe, reliable energy at reasonable rates. Safe, reliable, affordable and sustainable energy powers our communities and local economy, and helps our communities grow and thrive. We work hard to control our costs. The drivers for the increase in electric rates include:
- Investments made in solar and battery storage, including the Paris Solar-Battery Park, the Darien Solar Energy Center, the Sunnyside Solar Energy Center, the Koshkonong Solar Energy Center and the High Noon Solar Energy Center.
- Investments in the West Riverside Energy Center, which provides necessary reliability and dispatchability for our grid, helping to enable our transition to greater use of renewables and a decarbonized grid.
- Continued investment in our grid modernization projects, which upgrade our distribution system and provide for continued electric service reliability to customers.
The drivers for the increase in natural gas rates include continued investments in system modernization projects to maintain a safe and dependable system.
The PSCW will solicit public comments on MGE's application at a time and in a format to be determined, including scheduling a public hearing. A decision on the application is expected from State regulators by the end of 2025.
Other proposals included in this request
MGE is proposing an RNG pilot that would provide new opportunities for local sources that produce RNG, such as landfills and farms, to become part of MGE's natural gas supply. As a biogas, RNG is an organic source of natural gas.
This proposal also would help to reduce emissions from transportation because the RNG serving MGE’s natural gas distribution system would be locally produced. Our proposal also offers an opportunity for these participants in the pilot to sell the renewable thermal certificates to MGE. Those attributes then could be sold to MGE natural gas customers who have an interest in sourcing RNG locally to offset emissions from their use of natural gas.
This proposal, in addition to our current RNG option for customers, helps to advance our goal of net-zero methane by 2035.
MGE is proposing a new voluntary community solar program, Commercial Shared Solar. It's designed to meet the growing demand from commercial customers interested in addressing their own carbon reduction goals as MGE works toward net-zero carbon electricity on behalf of all customers.
Under the proposal, participating customers would pay a small upfront dollar amount to receive solar energy from a local solar array for a five-year period at a fixed rate with options to extend the agreement beyond the initial five years.
MGE customers on TOU rates pay a higher on-peak rate for their electricity during certain hours and a lower off-peak rate during certain hours. Currently, on-peak hours are considered 10 a.m. to 9 p.m. Monday through Friday. All other hours are considered off-peak.
MGE is proposing more focused TOU pricing periods to start in 2027.
- Proposed on-peak pricing period: 4 p.m. to 8 p.m. Monday through Friday.
- Proposed off-peak period: 10 p.m. to 4 a.m. every day.
- Proposed standard pricing period for all other hours.
MGE believes this proposed schedule enables a more manageable on-peak window and a more focused off-peak opportunity that is complimentary to customer technologies such as EV charging, home energy management systems and smart appliances, all of which can help to manage a more efficient electric grid.
MGE is proposing administrative adjustments to align with recent PSCW investigative efforts, including an update to the policy for Renewable Energy Credits so that renewable attributes associated with energy exported to MGE under our net metering tariff are retained by MGE.
- Currently under Pg-2, participants retain all the renewable attributes associated with the renewable energy purchased by MGE. That means the value of Pg-2 energy exports to MGE, purchased on behalf of non-participating customers, hold less than the value normally received from a renewable resource.
- Pg-2 participants receive a substantial incentive through favorable net metering rates, with the understanding that the exported energy is from a renewable resource. The Pg-2 incentives are effectively paid by non-participants. MGE believes it would be mutually beneficial for participating and non-participating customers for MGE to own the renewable attributes of the energy purchased under Pg-2 on behalf of all non-participating customers.
