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Thursday, January 22, 2009

WPL (Alliant) may raise rates

From an article by Judy Newman in the Wisconsin State Journal:

If you're a Wisconsin Power & Light customer, you may soon pay more for electricity.

WPL is expected to file an emergency request with state regulators for permission to raise rates. Just last month, the Madison utility company agreed to hold electric rates steady for 2009 and reduce natural-gas rates by $4 million.

The reason: the recession.

WPL is losing millions of dollars in revenues that had been pouring in when business was booming and factories were busy. Now, the General Motors plant in Janesville is down to a few dozen workers and the Domtar paper mill at Port Edwards is closed. Both were among WPL's top 10 power users.

Throughout southern Wisconsin, untold numbers of businesses are paring production and staff. That means less electricity is being used and WPL is collecting less money.

"We are sharing the pain being felt across our service territory," Bill Harvey, chairman and chief executive of WPL's parent company, Alliant Energy, told a conference call with analysts in December.

WPL won't say how much electricity GM and Domtar had been using but said that together, the price they paid for power amounted to 1 percent of the utility's revenues.

Harvey projected WPL's sales this year will be 6.4 percent, or $30 million, lower than those anticipated in the recent rate settlement, which was based on 2007 figures. "Because of this significant downward shift in forecasts, we will likely file an emergency rate case," he told analysts. . . .

Madison Gas & Electric and Milwaukee-based We Energies said they have no plans to seek a rate boost based on recession-impaired revenues. But both of those utilities have discussed the possibility of seeking increases to help meet pension costs.

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