Kaukauna Utilities could raise rates by up to 9.5% because of Appleton Coated

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The Fox Cities power company Kaukauna Utilities may have to raise rates on their customers after Appleton Coated cost them millions of dollars in financial loss.

Kaukauna Utilities general manager Jeff Feldt explained that the power company was already in the process of looking to raise their rates by 1.96% on customers’ bills, but then, their largest customer, Appleton Coated, shuttered its doors.

Back in July and the first half of August, Appleton Coated racked up $2.2 million worth of power usage, which was standard for the mill.

Then, Appleton Coated went into receivership, and it couldn’t pay the multi-million dollar power bill it owed Kaukauna Utilities. 

“Good portion of that, about 80% of that revenue that they owed us, we owed to our power supplier, and we had to pay that,” Feldt explained. “If we didn’t pay that, then we would’ve been in default, so we had to pull out almost $2 million out of our reserve to pay our power supplier for that power usage.

To make up for that major loss, Kaukauna Utilities could charge customers another half percent.

Here’s where the situation gets worse.

Since Appleton Coated may never be fully operational again, Kaukauna Utilities has to make up for the loss of their largest customer by charging the rest of their more than 15,000 customers an extra seven percent.

All added together, this comes to a total of charging customers 9.5% more per bill.

It’s an action that Feldt says the company wishes it did not need to consider, but it’s the only way to stay on top of finances after losing Appleton Coated, which provided a fourth of their revenue.

However much more customers will be charged, will not ultimately be decided by Kaukauna Utilities, but by the Public Service Commission of Wisconsin, an agency which regulates the power company.

The new rate could be set into customers’ bills by this spring.

“What we put out there in terms of 9.5%, that’s the worst case,” Feldt said. “We expect that it will probably be less than that, but you know, it’s a process, and it’s got to work its way though.”

The Public Service Commission of Wisconsin and Kaukauna Utilities will hold another public forum on January 23rd for customers to weigh in with their thoughts on the matter.

Copyright 2021 Nexstar Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

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