ELECTRIC COSTS WILL BE UP THIS SUMMER (6/12/07)
Electric Costs Will Be Up This Summer
For the next few months we expect the costs of power from our wholesale supplier to be substantially higher.
Some of the reasons for this dramatic increase are:
1) Demands for electricity are outpacing generation additions.
2) Planned outages at generating plants in Wisconsin lasted longer than anticipated.
3) There were a number of unplanned outages at generating plants causing utilities to use higher priced natural gas fired plants and to purchase higher priced electricity through the regional Midwest market.
4) Two major Wisconsin utilities filed for substantial rate increases in wholesale power with the Federal Energy Regulatory Commission (FERC). Alliant Energy filed for a 27% increase and WE Energies for a 35% increase. Wisconsin Public Power Incorporated (WPPI), Kaukauna’s wholesale power supplier, has contested the rate increases with FERC.
5) Railroad congestion has increased fuel delivery costs to coal-fired plants. It is unclear at this time how this issue will b resolved.
6) American Transmission Company (ATC) costs are increasing 20%, reflecting the extensive transmission construction program in Wisconsin.
Kaukauna Utilities and WPPI (Kaukauna Utilities wholesale power supplier) will do everything possible to help control costs. WPPI will continue to monitor competitive positions carefully and will do everything it can to maintain a strong position in purchasing wholesale power for the long term.
Kaukauna Utilities does generate approximately 15- 20% of our needs with the Hydro-Electric plants along the Fox River. The increase will be tempered somewhat depending on the amount of Hydro-generation available. Please note that Kaukauna Utilities owned hydro generation saves customers approximately $6,000,000 annually by not having to purchase power generated from higher costs natural gas and coal fired power plants.
Even with these increases, Kaukauna Utilities is still among the lowest cost power providers in the state. Energy costs to our customers are still 20-30% below the costs of neighboring Investor Owned Utilities.
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