We Energies gets OK to raise rate almost 4%

By THOMAS CONTENT tcontent@journalsentinel.com, Journal Sentinel

Wednesday, March 10, 2004

More than half of the nearly 1 million customers who buy natural gas service from We Energies will see a nearly 4% increase in their monthly bills, a rate increase authorized by the state Public Service Commission.

The increase will help defray costs of the Ixonia lateral, a natural gas pipeline that links the new Guardian pipeline with the Milwaukee area. The lateral opened in December.

The commission granted the utility an increase of $25.97 million for the year, or 3.84%, slightly less than the utility requested last year.

The increase will generate about $16.7 million for the Ixonia lateral, plus about $9.2 million for the state program that provides assistance to low-income residents with heating bills.

For a typical customer using 950 therms of natural gas a year, the increase would mean an extra $2.92 on a monthly natural gas bill, utility spokeswoman Margaret Stanfield said.

The increase affects only customers of the former Wisconsin Gas Co., about 577,000 of the utility's 1 million natural gas customers.

The rate increase the utility has sought for its electricity customers has been delayed while the commission considers the impact of a recent court ruling concerning the Port Washington power plant.

The company plans to retire the Port Washington coal plant and replace it with two natural gas plants now under construction. A Dane County judge decided in January that the commission's environmental analysis of the plants was inadequate and vacated approval of the plants.

The commission is weighing whether to permit the utility to recover costs associated with the construction of the power plant -- something customer groups are now questioning in light of the judge's ruling.

PSC spokeswoman Stephanie Marquis said she did not know when the commission would decide on the electricity portion of the We Energies rate case.

In December, We Energies began pumping natural gas through the $97.5 million Ixonia lateral, a 38-mile feeder pipeline that routes natural gas from the Guardian Pipeline, completed a year ago, to the utility company's southeastern Wisconsin distribution system. Guardian, a $220 million project, pumps natural gas from Joliet, Ill., to Ixonia.