Wisconsin ratepayers will see a smaller electricity bill increase after the Public Service Commission voted Thursday to approve a roughly 7% rise in We Energies rates spread across 2027 and 2028. The decision marks the utility’s sixth consecutive rate adjustment but reflects the commission’s effort to balance necessary infrastructure investment with the financial realities of households that already face some of the highest rates in the region.

Commissioners curb the increase and shareholder profits

Commissioner Kristy Nieto opened the 10‑hour hearing by warning that “we cannot ignore the cumulative impact of years of increases simply because each individual increase can be explained by a particular investment or expense.” She emphasized that when customers are paying high rates, regulators must ensure the scales are properly balanced.

After extensive testimony, the commission reduced the utility’s proposed 9% overall increase— which included a 16% jump for residential customers— to about 7%. The average residential bill is expected to rise between $7 and $8 per month in 2027 and another $6 to $7 in 2028.

Rate‑of‑return adjustments save ratepayers

In addition to lowering the overall hike, commissioners trimmed the utility’s guaranteed “rate of return.” We Energies shareholders typically earn a 9.8% return, rising to roughly 10.5% for infrastructure projects serving data centers. The utility had asked for a modest increase to 9.9%, but the commission set the rate at 9.5%, a move that will save ratepayers an estimated $60 million over the next two years.

Critics such as Walmart called the original request “unjustified,” arguing it would push shareholder profit margins above the national average. The Wisconsin Citizens Utility Board also urged a lower rate, and the commission’s compromise reflects those concerns.

Renewable projects and data‑center costs under scrutiny

Much of the new revenue will be directed toward emerging renewable energy, natural gas, and battery storage projects. However, the commission pushed back on the utility’s plan to bill all ratepayers for a quarter of the costs of building new power plants for data‑center customers. Instead, the commission ordered that those construction costs be assigned directly to the large data‑center customers themselves.

A pending agreement with Oracle for a share of the Point Beach Nuclear Plant’s output could save ratepayers roughly $300 million in fuel costs over five years, though the commission has yet to approve the deal.

Overspend on solar and battery projects addressed

Commissioners also addressed recent overspending on a southeast Wisconsin solar farm and battery storage facility. The utility’s purchase price exceeded the commission‑approved figure by nearly 40%, a shortfall the commission attributed to inflation, component shortages, and new forced‑labor compliance laws. While the commission allowed the utility to recover the full cost from ratepayers, it barred any profit on the $166 million overrun.

Commissioner Marcus Hawkins warned that allowing utilities to “put their head in the sand” on budget risks would leave customers to absorb unexpected costs. He emphasized the need for transparency and accountability in future infrastructure proposals.

Future oversight and local impact

The commission plans to revisit two other multimillion‑dollar overspends in upcoming rate cases: the Darien Solar Energy Center (35% over budget) and the Koshkonong Solar Energy Center (42% over budget). Both projects will proceed only if ratepayers are not billed beyond the original price tags.

Wisconsin’s recent shift to a Democratic trifecta in the 2027 elections adds a new political backdrop, but the commission’s chair signaled a willingness to work with lawmakers on overhauling state utility regulation rules to further protect consumers.

Overall, the commission’s actions aim to ensure that necessary upgrades to Wisconsin’s energy grid— including renewable and battery storage investments— are funded responsibly, without imposing undue financial strain on families and small businesses across the state.

Original reporting: Wisconsin Watch — read the source article.