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Madison Gas and Electric Company Seeks Rate Increases in Wisconsin Docket

Strategic Insights

— 1 min read

Madison Gas and Electric Company is seeking permission from the Public Service Commission of Wisconsin to adjust its electric and natural gas rates. According to the testimony of Jered R. Schmudlach, Manager of Business Planning for MGE, the company proposes to increase retail electric rates by 4.89% and retail natural gas rates by 2.33% in Test Year 2026. This would follow increases of 4.33% in electric rates and 2.16% in natural gas rates in Test Year 2027.

Key Takeaways:

  • MGE proposes to increase retail electric rates by 4.89% and retail natural gas rates by 2.33% in Test Year 2026.
  • The company also seeks to increase electric rates by 4.33% and natural gas rates by 2.16% in Test Year 2027, above proposed 2026 rates.
  • MGE's revenue requirement calculation for Test Year 2027 would result in an increase of 9.42% in electric rates and 4.52% in natural gas rates, respectively, compared to 2025 base rates.
  • The company proposes to maintain its existing capital structure of 55.00% level of equity on a financial capital structure basis and a return on equity (ROE) of 10.0%.
  • MGE's credit quality differentiation from industry peers is a significant factor in its ability to raise capital, and the company's strong capital structure and excellent credit quality have benefited both customers and shareholders.
  • The Commission's long-standing support of MGE's strong capital structure has protected the company and its customers during times of elevated financial market volatility.

Statistics:

  • Proposed increase in retail electric rates: 4.89% in Test Year 2026, 4.33% in Test Year 2027.
  • Proposed increase in retail natural gas rates: 2.33% in Test Year 2026, 2.16% in Test Year 2027.
  • Revenue requirement calculation for Test Year 2027: increase of 9.42% in electric rates, 4.52% in natural gas rates, compared to 2025 base rates.
  • MGE's financial capital structure: 55.00% level of equity.
  • Return on equity (ROE): proposed rate of 10.0%.

Sources:

  • Application of Madison Gas and Electric Company for Authority to Adjust Electric and Natural Gas Rates, Docket 3270-UR-126, Public Service Commission of Wisconsin.
  • Direct Testimony of Jered R. Schmudlach on Behalf of Applicant, in Application of Madison Gas and Electric Company for Authority to Adjust Electric and Natural Gas Rates, Docket 3270-UR-126, Public Service Commission of Wisconsin.

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