Superior Utility Adjusts Rate Increase Request Due To Husky Fires

A Superior utility is applying to the Public Service Commission of Wisconsin to raise electric, natural gas and water rates.

Superior Water, Light & Power Company is requesting rate increases to pay for improvements to its water and electric system, as well as to recover a projected loss of revenues from the Husky Energy fires in April.

The utility is seeking a 2-percent increase in electric rates, a 2.3-percent increase in natural gas rates and an 8.3-percent increase in water rates. The company expects the rate hikes to bring in about $2.4 million.

SWL&P has been making significant investments to upgrade its water infrastructure. The utility plans to spend around $18 million this year on capital projects to replace century-old water mains, upgrade water lines and make improvements to its water treatment plant.

The application to the PSC reflects an adjustment to a rate request they were already planning, said Deb Amberg, president of SWL&P.

“The rate request would have been submitted regardless of the fire that occurred on April 26,” said Amberg. “This is a rate increase that we knew we would be requesting based on the capital projects. The fact that we now believe that they would unlikely be operating at the same levels that they would normally operate, that has then reduced the amount of volume we believe we’ll be selling in water to Husky.”

Amberg said Husky Energy is the utility’s largest water customer, accounting for 25 percent of the 843 million gallons of water sold to customers in 2017. However, she noted the water rate request would likely decrease as Husky resumes operations.

“As everyone learns more about Husky returning to production, then we’ll make adjustments to that request,” she said. “As the loads are higher again, as Husky comes back into service, we would expect then that the rate would not need to increase as much because we would have additional sales to spread that across.”

The company is also planning to issue new debt this year of around $12 million to fund many of its capital projects. SWL&P is also planning to construct a new switching station this year to improve the reliability of its electric system. Public hearings on the requested rate increases would likely be held this year. If approved, the rate hike is anticipated to take effect in 2019.