The Lansing Board of Water and Light is authorizing increases to its electricity and water rates in October despite community pushback against its cost and environmental impacts.
The BWL Board of Commissioners approved the rate hike 5-1 Tuesday evening. Utility officials say the average customer will pay around $11 more on their monthly bills starting in October, with a second increase taking effect in 2025.
“Nobody wants to pay an increase in our rates,” said BWL Commissioner Anthony Mullen. “But we have to remember that this rate increase is going to still keep us below the inflation rate. We need to get this money in so that we can continue providing the power, the water, the chilled water, the steam that the city needs.”
Under the rate hike, residential electricity costs will increase by 6.95% this year and 6% the following year. Water rates will go up by 9.23% this year and 9.15% in 2025.
The utility estimates the rate increases for water, electricity, steam and chilled water will cost ratepayers $26.4 million more in billings this fiscal year and $25.4 million more the following year.
Commissioner Dale Schrader, the lone vote against the increases, said he would support a one-year rate hike but opposed scheduling an increase for next year.
The measure represents the BWL’s sixth approved water and electricity rate increase since 2018. The utility did not adjust its rates for nearly two years beginning at the onset of the COVID-19 pandemic. Officials have stated that this year’s planned rate hikes are meant to address operational costs and support clean energy goals.
Dozens of residents have pushed back on those claims, criticizing plans to develop a new natural gas plant that would emit hundreds of thousands of tons of greenhouse gases.
Lansing City Councilmember Brian Jackson submitted a letter with support from local government officials to oppose the rate hike. He called the rate hike “misleading” and urged the utility to support renewable energy investments instead of fossil fuels.
“If we don't have leadership that's able to take us in that direction for whatever reason, then it's up to us to find someone who can do it, because it's state law and our environmental safety and future, and [our] kids and everybody's future depends on getting things right,” Jackson said. “Reconsider the rate hike because it’s not really going towards clean energy.”
In a letter sent to local governments and organizations in mid-Michigan, Dick Peffley, BWL’s general manager, defended the utility’s energy planning decisions. He argued the technology to store power from solar panels and wind turbines is currently unavailable to achieve the utility’s goals for reliability and affordability.
“The goal of eliminating fossil fuels from the repertoire of energy production is shared not only by those with a single-minded agenda to immediately eliminate fossil fuel use, but also by utilities such as the BWL,” Peffley wrote. “The time will come when that goal can be achieved without sacrificing Reliability or Affordability in favor of Sustainability, but it is not here yet.”
Residents told the BWL at last week’s public hearing that they can’t afford to pay higher rates for electricity and water. Ahead of the vote Tuesday evening, Mullen noted the municipal utility’s rates remain lower than its private competitors. He told community members to take advantage of additional government resources.
“If you're unable to make your payments, give us a call. We'll point you to the direction that you need to go to be able to pay your bills,” he said.
The state offers an energy assistance program to help ratepayers struggling to pay for utilities. The BWL is offering more information about payment plans and support options at its Community Resource Fair on Oct. 2 at the Alfreda Schmidt Community Center.
The Lansing Board of Water and Light is a financial supporter of WKAR.
