MGE Rate Changes Approved
State regulators have approved a rate case settlement agreement filed in mid-July by Madison Gas and Electric (MGE), our regulated utility. The agreement lowers electric rates and increases natural gas rates in 2019 and 2020.
The agreement decreases overall electric rates by 1.94% in 2019. No change was proposed for 2020. The proposed decrease reflects the ongoing tax impacts of the 2017 Tax Cuts and Jobs Act as well as the addition of lower-cost renewable generation capacity, such as MGE's Saratoga, Iowa, wind farm
currently under construction.
The agreement increases overall natural gas rates by 1.06% in 2019 and 1.46% in 2020. The increase covers natural gas system infrastructure improvements to ensure the continued reliability and safety of our natural gas system. It also reflects the impacts of the 2017 Tax Cuts and Jobs Act.
The rate changes take effect Jan. 1, 2019.
Agreement provides MGE future operational flexibility
The settlement agreement includes the accelerated depreciation of certain assets, including the company's combustion turbines, Blount Generating Station in downtown Madison, Wis., and Columbia Energy Center Unit 1, which is located near Portage, Wis.
"By essentially paying off these older assets sooner, we have more flexibility to make new investments in cost-effective renewable energy and move us toward our Energy 2030 goals while mitigating impacts on rates," explained Jeff Keebler, MGE president and CEO. "This collaborative settlement process has resulted in multiple benefits to customers through lower electric rates and the opportunity for increased investment in sustainable energy."
The settlement agreement between MGE and intervening parties resolved issues in MGE's rate case. The other parties in the settlement agreement are: Citizens Utility Board, Wisconsin Industrial Energy Group, Airgas USA LLC, RENEW Wisconsin, Clean Wisconsin, and Board of Regents of the University of Wisconsin System.
The PSCW approved the settlement agreement in September.