The Memphis Light, Gas and Water (MLGW) Board of Commissioners approved a new operating budget that includes significant rate adjustments for the city’s utility customers. The proposal, presented by President and CEO Doug McGowen, calls for a 12% increase in rates for residential customers, a 20% increase for commercial and industrial users, and a 30% increase for data centers.
Rate changes and their impact
Under the approved budget, the average residential water bill is expected to rise by roughly $10 per month, while the average gas bill could climb about $18 per month. The board says these adjustments are necessary to fund ongoing infrastructure projects, including grid modernization efforts that aim to reduce outages and improve service reliability.
Commercial and industrial customers will see a 20% increase, reflecting higher consumption patterns and the need to maintain a robust supply network for businesses across the city. Data centers, which consume large volumes of electricity and water, are slated for a 30% rate hike. The board argues that the higher charge reflects the intensive resource demands of these facilities and helps ensure that the broader community does not bear disproportionate costs.
Community response
Advocacy groups such as Protect Our Aquifer voiced concerns about the residential increase, urging the board to keep rates flat for households. Their position highlights the importance of affordable utility services for families, especially in a city where many residents are already managing tight household budgets.
Board members, however, emphasized that the modest increase is part of a gradual, multi‑year plan designed to spread costs over time rather than imposing a sudden, larger burden. McGowen noted that the budget also includes investments in water conservation programs and upgrades to the gas distribution system, which are intended to lower long‑term operating expenses and protect the region’s water resources.
Next steps
The budget now moves to the Memphis City Council for final approval. Council members will review the proposed rates alongside other city priorities, such as public safety funding and infrastructure improvements. If the council adopts the budget, the new rates are expected to take effect at the start of the next fiscal year.
In recent months, MLGW has already implemented a 4% portion of a larger 12% electricity increase approved in late 2023. That earlier hike added about $5 per month to the average electric bill and was earmarked for grid modernization. The current proposal builds on those efforts, aiming to create a more resilient utility system capable of supporting Memphis’s growing population and expanding data‑center industry.
What residents can do
Residents who wish to voice concerns or seek clarification about the upcoming changes are encouraged to attend the upcoming City Council meeting or contact MLGW’s customer service department. The board has pledged to provide detailed information on how the rate adjustments will be applied and to offer resources for households seeking assistance with higher utility costs.
Original reporting: Action News 5 WMC (Gray) — read the source article.
