Green Bay, WI-based Wisconsin Public Service Corp. (WPS) and the state Citizens Utility Board (CUB) reached agreement early in September on several energy-saving initiatives for the electric and natural gas WPS customers. The CUB filed the stipulation with the Wisconsin Public Service Commission (PSC) last Tuesday, seeking the regulators’ approval.

The series of programs that the utility and the consumer unit agreed to are aimed at helping customers cut their energy use and eventually lower retail energy utility rates. The proposal calls for a four-year pilot program to begin the process.

Under the pilot program, WPS agreed to reduce its fixed customer charges, increase its annual contribution to statewide conservation efforts in each of the first four years, and conduct what the utility called “innovative rate offerings” in three communities as a means of building customer awareness and more of an ability to apply energy efficiency measures.

WPS also will support Wisconsin Gov. Jim Doyle’s task force recommendations on new or improved state building codes and new or improved appliance standards. The deal allows the utility to earn a profit on the energy efficiency programs, something the CUB had previously opposed.

The CUB now supports the measure as outlined for WPS’s four-year pilot and its executive director, Charlie Higley, told local news media that the CUB wants the state’s other major private-sector utilities to provide similar programs.

WPS said that to balance the potential for reduced utility revenues from the increased conservation by customers, WPS will have a revenue stabilization mechanism beginning next year for most of its customers. The utility will be assured a certain revenue level for its natural gas and electric deliveries regardless of weather and other conditions. Adjustments will be made annually, the utility said.

Jim Schott, WPS regulatory affairs vice president, said the focus of the program will be on encouraging more energy conservation in “a number of new and innovative ways. Revenue stabilization mechanisms ensure that WPS will be a strong and enthusiastic supporter of these energy conservation programs without worrying about how it will affect the bottom line.”

CUB’s Higley said the key was that by reducing the fixed charge (not tied to consumption) and increasing the volumetric charge for gas or electricity, customers will be encouraged to use less energy. “Reducing the fixed charge helps low-income and other customers who use a minimum amount,” he said. “The community pilots will help us understand the ways customers react to innovative pricing.”

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