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Some Evansville residents to see bump in electric bills

MADISON — The Evansville Water & Light Department will charge average residential customers an additional $7 on their monthly electric bills after the Wisconsin Public Service Commission approved a 7.7 percent rate increase this week.

Residential customers now paying $83.70 for 770 kilowatt hours of power a month will pay $90.70 for the same amount when the new rates take effect between Sept. 20 and Oct. 20. The new rates will be included on bills mailed in early November.

City Administrator Dan Wietecha said the first rate increase since 2007 was necessary to keep up with increasing costs of wholesale power the department purchases, plus labor, material and other expenses.

Without the increase, the utility was forecasting a net operating income this year of $78,498 on expected revenues of $7.831 million and operating expenses of $7.752 million. That would yield a .92 percent return on its infrastructure investment, which the PSC called "inadequate."

The utility had sought a 6.25 percent return on its infrastructure investment that would have generated $540,658 in additional revenue. Instead, the PSC trimmed the revenue request by about $105,000. It then approved rates that would generate an additional $435,275 in revenue totaling $8.266 million annually with a $513,772 net operating income and 5.6 percent return on infrastructure.

Wietecha said the PSC trimmed $105,000 from the rate application filed in January because interest expense had decreased since then, and the PSC used different calculations to determine the depreciated cost associated with staff labor.

"It (the decreased revenue authorized) won't have an affect on us," he said.