Retail electric increases average about 3.97% annually, above those currently in effect, over almost two years. Retail gas rates to go up about 2.16%.
GREEN BAY, Wis., April 1, 2008 /PRNewswire-FirstCall/ — Wisconsin Public Service Corporation, a subsidiary of Integrys Energy Group (NYSE:TEG) , today filed with the Public Service Commission of Wisconsin (PSCW) a request to increase retail electric rates by about 7.75% in 2009 and 0.33%, plus an adjustment for fuel-related costs, in 2010. The filing includes an increase in overall retail natural gas rates by 2.16% for 2009 with no increase in 2010. If approved and applied equally to all rate classes, the request for 2009 will result in monthly increases of about $6.11 for typical residential electric customers using 630 kilowatthours, and $2.18 for typical residential customers using 900 therms of natural gas annually.
Public Service expects new rates to be effective around January 1 of each year.
“The new Weston 4 power plant will be available for 2009 and 2010,” said David Kyto, Director — Rate Case Process. “That will result in a significant savings in purchased power costs. Without Weston 4, these electric increases would be significantly higher.” Regarding natural gas cost control, Kyto said that Wisconsin Public Service has reduced its costs to environmentally remediate old manufactured gas plant sites in 2009 and 2010 by successfully pursuing insurance recoveries.
This new request is for rates in both 2009 and 2010. In 2010, the only adjustments will be for fuel and related costs, along with a few specific items that are known to occur in 2010. These items include increased costs associated with scheduled electric generator maintenance at Wisconsin Public Service’s peaking plants and increased costs associated with electric transmission, as well as reduced costs for environmental compliance. The impact of the 2010 fuel adjustment is not known at this time and could increase or decrease rates.
Major factors in the electric rate request include:
— The completion of the refund to Wisconsin retail electric customers of
the Non-Qualified Decommission Trust fund related to the sale of the
Kewaunee nuclear power plant in 2005. As authorized by the Commission,
Wisconsin Public Service refunded the fund to its Wisconsin retail
customers over 2006 and 2007. As a condition related to the Integrys
merger, for 2008 Public Service received a rate increase for only fuel
and related costs; in essence, absorbing the increased costs that had
previously been offset by the Kewaunee refund. The absence of the
refund in 2009 accounts for a little more than half of the requested
electric increase.— The costs associated with the construction, operation and maintenance
of the new 500-megawatt Weston 4 power plant near Wausau, Wisconsin.
These costs will be more than offset by Weston 4’s low cost of
generating energy as opposed to purchasing power and the increased
sales of energy to other utilities that Weston 4 will enable Wisconsin
Public Service to make in 2009. In its first full year of operation,
Weston 4 will reduce customer rates by about $40 million when compared
to 2007.— The cost of the company’s environmental compliance program, which is
comprised of a broad range of strategies to eliminate costs and risks.
As always, Public Service is using the most economical options to meet
these mandates — a combination of funding environmental projects at
its generating plants and buying emission credits in 2009. The company
expects to buy fewer NOX emission credits in 2010 compared to 2009 as a
result of control equipment to be installed on coal plants in 2009.— The cost of scheduled maintenance at other Wisconsin Public Service
electric generating units.— The cost of electric transmission service from American Transmission
Company and Midwest Independent Transmission System Operator.— Costs associated with the recent Weston 3 outage due to a severe
lightning strike.
Not included in this rate request are any costs associated with the construction of an Iowa wind farm that will help Wisconsin Public Service reach its Renewable Energy Portfolio target. The PSCW is expected to approve the wind farm later this year.
Major factors in the natural gas request are:
— The cost of building new natural gas pipeline laterals that will
connect the Wisconsin Public Service gas system to the Guardian II
pipeline. This initial increased cost is expected to be offset in the
future as the result of more pipeline capacity and competition for
supplying Wisconsin Public Service’s natural gas needs.— Decreased costs associated with environmental remediation of the
company’s manufactured gas plants. Wisconsin Public Service has been
successful in recovering additional insurance proceeds to fund
remediation efforts in 2009 and 2010.Forward-Looking Statements
This news release contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934. You can identify these statements by the fact that they do not relate strictly to historical or current facts and often include words such as “anticipate,” “expect,” “intend,” and other similar words. Forward-looking statements are beyond the ability of Integrys Energy Group to control and, in many cases, Integrys Energy Group cannot predict what factors would cause actual results to differ materially from those indicated by forward-looking statements. Please see Integrys Energy Group’s periodic reports filed with the Securities and Exchange Commission (including its 10-K and 10-Qs) for a listing of certain factors that could cause actual results to differ materially from those contained in forward-looking statements.
About Integrys Energy Group, Inc.
Integrys Energy Group, Inc. (NYSE:TEG) , headquartered in Chicago, Illinois, is a holding company for energy related subsidiaries, which includes regulated utilities and nonregulated subsidiaries.
The six regulated utilities consist of:
— The Peoples Gas Light and Coke Company, a natural gas utility serving
approximately 830,000 customers in the City of Chicago.
— Wisconsin Public Service Corporation, an electric and natural gas
utility serving approximately 433,000 electric customers and 314,000
natural gas customers in northeastern Wisconsin and an adjacent portion
of Michigan’s Upper Peninsula.
— Minnesota Energy Resources Corporation, a natural gas utility serving
approximately 207,000 customers throughout Minnesota.
— Michigan Gas Utilities Corporation, a natural gas utility serving
approximately 165,000 customers in lower Michigan.
— North Shore Gas Company, a natural gas utility serving approximately
158,000 customers in the northern suburbs of Chicago.
— Upper Peninsula Power Company, an electric utility serving
approximately 52,000 customers in Michigan’s Upper Peninsula.The company’s principal nonregulated subsidiary is:
— Integrys Energy Services, Inc., a diversified nonregulated energy
supply and services company serving residential, commercial,
industrial, and wholesale customers in developed competitive markets in
the United States and Canada.
More information about Integrys Energy Group, Inc. is available online at http://www.integrysgroup.com/.
First Call Analyst:
FCMN Contact:
Source: Wisconsin Public Service Corporation
CONTACT: David Kyto, Director, Rate Case Process of Integrys Energy
Group, Inc., +1-920-433-1502, cell, +1-920-660-0622
Web site: http://www.integrysgroup.com/
