We Energies Rate-Freeze Plan Wins Regulatory Approval

We Energies and Wisconsin Public Service Corp. won final state regulatory approval for a proposal to freeze business and residential rates for two years in what the company calls its response to complaints from industrial customers that electric rates in Wisconsin are too high.

The public utility companies owned by WEC Energy Group Inc. filed a proposed settlement in April to avoid the cost and effort of a full review by the Public Service Commission of Wisconsin.  At the time, the companies said 21 industrial customers signed statements backing the rate proposal.

The rate freeze adds two years to an existing two-year flatrate period that runs through 2017. The settlement also makes permanent cheaper wholesale rates that large industrial customers pay for expanded use of power from We Energies. The Public Service Commission has approved a draft order approving the company proposal for 2018 and 2019. The commission in August had voted to support the plan from the WEC Energy companies.

The PSC draft order determined that freezing We Energies base rates through 2019 was reasonable and in the public interest. The order also states that it’s reasonable to authorize We Energies to
extend and expand the market-based pricing for electric service at large commercial and industrial customers.

A WEC Energy spokeswoman said company executives are pleased with the commission’s action.

PSCW APPROVES RATE FREEZE FOR WE ENERGIES, WPS CUSTOMERS

The Wisconsin Public Service Commission has approved a two-year rate freeze for We
Energies’ and Wisconsin Public
Service’s electric and natural gas customers. The rate
freeze was part of a settlement proposed by WEC Energy Group,
the utilities’ parent
company, and supported by 24 of its largest customers. The two-year rate freeze means
that We
Energies’ electric rates — excluding fuel costs, which fluctuate — will remain
unchanged for four years. Six years also
will have passed since the utility’s last significant
increase in electric rates. In accepting the proposed settlement, the
commissioners made
clear that the commission will need to address several issues involving deferred costs that
have not
been included in We Energies rates. Those costs were projected to reach almost
$500 million by the end of the year.

WEC SUBSIDIARY TO BUILD TWO NATURAL GAS GENERATORS IN UPPER PENINSULA

A subsidiary of We Energies has asked for approval to build two generating plants
located in Baraga and Marquette counties in Michigan’s Upper Peninsula at a cost of
$277 million. Upper Michigan Energy Resources Corporation would build the natural
gas projects by 2019 enabling We Energies to shut down its coal-fired power plant in
Marquette, Michigan, by 2020. This would eliminate the need for Wisconsin ratepayers to
continue paying for that plant.

ARMY CORP OF ENGINEERS PROPOSES AGREEMENT

The U.S. Army Corps of Engineers is proposing to let several utility companies pay to speed up review of their permit
applications in Minnesota and Wisconsin. Under the plan, the utilities would fund up to two full-time staff to handle
wetland and water crossing permits from American Transmission Company and WEC Energy Group whose subsidiaries include We Energies, Wisconsin Public Service Corporation, the Wisconsin River Power Company and Minnesota Energy Resources Corporation.

WEC Earnings Accelerate In First Quarter

In part as a result of the acquisition of Integrys Energy Group, Wisconsin Energy has reported net income of $346.2 million, up from $195.8 million in last year’s first quarter. Earnings per share were $1.09, compared with 86 cents last year. Analysts who follow the company were expecting profit of $1.01 per share. That $9.1 billion deal added Wisconsin Public Service in Green Bay as well as Peoples Gas in Chicago and natural gas utilities in Michigan and Minnesota.

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