Brian Dake

Utility regulators in the United States are considering increases to electricity rates again this year as electric utilities seek to cover the investments needed to maintain and expand their systems. Utilities requested rate increases in recent years to pay for improvements to transmission and distribution lines to withstand increasingly serious weather and fire events, prepare for increased electrification as state and federal clean energy legislation is implemented, and move more energy reliably, according to S&P Global Market Intelligence Capital IQ Pro.

State utility regulators signed off on $9.7 billion in net rate increases in 2023, more than double the $4.4 billion authorized in 2022. The net increase—increases minus decreases—reflects $10.3 billion in authorized rate increases and only $0.6 billion in rate decreases. More than one-third of the net rate increase supported increases at two California utilities seeking to make their grids less susceptible to wildfire.

From the start of 2023 through August 12, 2024, regulators nationwide have authorized 58% of the net rate increases that were requested by electric utilities, according to S&P Global Market Intelligence Capital IQ Pro. If the same ratio of rate increase requests is allowed for the rest of 2024, rate increases are on track to reach $8.9 billion (adjusted for inflation to 2023 dollars) this year.

In many states, all components of a typical electric bill are approved by the state utility regulator. In states that allow competition for electricity supply, energy suppliers charge competitive rates for the generation component of power bills. All charges for energy delivery over transmission and distribution lines are still regulated by state utility commissions.

When regulated investor-owned utilities (IOUs) expect their future revenues needed to operate their systems will exceed expected revenue from consumers under existing rates, they request a rate case in front of the state regulator to justify raising their rates. IOUs are generally reimbursed on allowed operating and maintenance costs and investments and on a regulator-approved rate of return on their investment as profit. Other utilities, such as cooperatives and government-owned municipal, state, political utility district, and federal utilities, are non-profit and may not be regulated in the same way.

State environmental regulators released a final environmental impact statement Friday on a Canadian energy firm’s plans to reroute an oil and gas pipeline around a northern Wisconsin tribe’s reservation.

In 2019, the Bad River Band of Lake Superior Chippewa sued Canadian firm Enbridge in federal court to shut down and remove the 70-year-old Line 5 on tribal lands. In response, the company proposed a $450 million plan rerouting the pipeline around the tribe’s reservation.

Line 5 runs 645 miles from Superior to Sarnia, Ontario. It’s designed to carry up to 540,000 barrels of oil and natural gas liquids daily.

In the proposed reroute, a new stretch of 30-inch pipe would run 41 miles around the reservation in Ashland and Iron counties. State and federal regulators say the project would cross 186 waterways and temporarily disturb 101 acres of wetlands.

The 898-page document released Friday relied on 10,000 pages of materials that reflects hours of testimony and more than 32,000 comments submitted to the agency, according to Greg Pils, director of the DNR Bureau of Environmental Analysis and Sustainability.

“This is a critical step in making a permitting decision,” Pils said. “The (environmental impact statement) does not compel a decision, but it is there to inform our decision-making.”

Enbridge has applied for multiple permits with the agency. Pils said the agency doesn’t have a timeline for issuing decisions on whether to approve or deny those applications.

In a statement, Enbridge spokesperson Juli Kellner said the document’s release is an important step in the permitting process for the project.

“The project has been designed to avoid and minimize temporary construction impacts, and we believe the planned route is the best alternative,” Kellner wrote. “The Wisconsin DNR has thoroughly evaluated the environmental impacts of the proposed project.”

Gross property tax levies approved in 2023 by local taxing jurisdictions in Wisconsin increased by4.6% statewide, which exceeded inflation and was the largest increase since 2007.

Meanwhile, equalized property values increased 7.7% in 2024 – a slowdown from the record pace of the two prior years, but still a large increase by recent standards.

Annual growth in property values once again exceeded the growth in property tax levies, causing the statewide gross property tax rate to decline for the tenth consecutive year. It went from $16.78 per $1,000 of equalized property value in 2022 to $15.53 in 2023, a 7.5% decline.

These are among the key statewide findings from the Wisconsin Policy Forum’s newly updated 2024 Property Values and Taxes DataTool, which features interactive data for all of Wisconsin’s 72 counties and nearly 1,850 cities, villages, and towns. It is the latest in a series of Forum interactive tools meant to provide all Wisconsinites with relevant facts about their schools, local governments, and state and regional economy. Key findings from the tool are

 The state’s 7.7% increase in total equalized property values in 2024 was significantly lower than the growth seen in 2022 (13.8%) and 2023 (13.1%). Still, with the exception of those two years, the 2024 increase was the highest since 2006. In the period between 2007 and 2021, statewide annual property value increases never exceeded 6.8%.

 Residential property values for the state of Wisconsin grew 8.7% in 2024, which was significantly lower than the state’s increases in 2022 (14.9%) and 2023 (14.0%) but still the third-largest rise since 2006. Meanwhile, after near-record growth of 13.2% (2022) and 10.9% (2023), statewide commercial property values increased by 10.1% in 2024.

 The 4.6% increase in statewide gross property tax levies – which appears on December 2023 tax bills, and provides revenue for 2024 local budgets — was nearly double the previous year’s increase. It also surpassed the 2023 inflation rate of 4.1%. This follows two years in which inflation substantially outstripped statewide levy increases.

A trade group representing independent grocery stores is calling for lawmakers and regulators to enforce an existing antitrust law it believes would do more to improve competition and help consumers than the push against alleged “price gouging.”

The National Grocers Association, which represents independent grocers that are privately owned by families or by employees as well as wholesalers in that segment, has called for the law’s use to address pricing competition in the industry. Chris Jones, NGA’s chief government relations officer and counsel, told FOX Business that pricing from suppliers is one of the biggest issues the group’s members face in competing with larger rivals.

“You’ve got a handful of really large, dominant firms in this country who have a lot of power in the market,” he said. “Walmart being the biggest fish in the sea… they’re pretty close to 30% of sales in this country, over $300 billion in food sales in a $1 trillion market. What that means for the supply chain is that they have a tremendous amount of power over suppliers.”

Jones explained that the supply chain clout of larger companies like Walmart helps them get more favorable pricing with suppliers. He went on to say that the proposed Albertsons-Kroger merger, which is the subject of a pending antitrust case, has shown that those two companies believe they need to join forces to better compete against Walmart in the grocery industry.

“So we see it as a major threat to our segment of the industry,” Jones said of the proposed merger. “I think the problem shouldn’t be solved through a large merger. It should be solved through the enforcement of laws that are supposed to limit the ability of Walmart to use its coercive power. A law called the Robinson-Patman Act is the one that comes to mind that’s supposed to help level the playing field — so long as buyers are purchasing in equal or similar quantities, they should be getting the same price.”

The Robinson-Patman Act aims to prevent sellers from charging competing buyers different prices for the same commodity or discriminating in providing “allowances” in the form of compensation for advertising and other services.

“This kind of price discrimination may give favored customers an edge in the market that has nothing to do with their superior efficiency,” the Federal Trade Commission (FTC) notes on its website in reference to the law. “Price discriminations are generally lawful, particularly if they reflect the different costs of dealing with different buyers or are the result of a seller’s attempt to meet a competitor’s offering.”

A report by the law firm Morgan Lewis noted that the Department of Justice announced it would stop enforcing the Robinson-Patman Act in 1977 and that the FTC hasn’t brought a case under the law since 2000 — though the law has since been enforced through civil litigation. However, the report noted that the FTC has in recent years expressed an interest in revitalizing the law’s enforcement.

Inflation held steady in July as American households spent more money and saw their incomes rise slightly, according to data release Friday by the Bureau of Economic Analysis (BEA).

The personal consumption expenditures (PCE) price index — the Federal Reserve’s preferred way to measure inflation — rose 0.2 percent last month and 2.5 percent over the past year.

Household incomes also rose 0.3 percent and consumer spending rose 0.5 percent without adjust for inflation. Inflation-adjusted consumer spending still rose 0.4 percent.

The new inflation figures come less than a month before the Fed is expected to cut interest rates at a highly anticipated September policy meeting.

Fed Chair Jerome Powell said last week that “the time has come” for the central bank to begin reducing borrowing costs after keeping them at two-decade highs for more than a year.

Over 14,000 supporters, including over 11,500 Wisconsinites, joined a petition organized by the Wisconsin Jobs and Energy Coalition calling on the U.S. Army Corps of Engineers to issue the permits necessary to reroute a portion of the Line 5 pipeline in Bayfield, Ashland and Iron Counties. The petition was in response to a public comment period following the release of the Army Corps’ Line 5 relocation project Draft Environmental Assessment in May.

In addition to the thousands of petition signers, over three dozen of Wisconsin’s leading organizations representing labor, business, agriculture, and local governments, sent letters to the U.S. Army Corps of Engineers in support of the Line 5 relocation project. The diverse coalition included organizations such as Wisconsin Independent Businesses, the Wisconsin Building Trades Council, Wisconsin Manufacturers and Commerce, Wisconsin Counties Association, and the Wisconsin Ag Coalition.

Line 5 moves roughly 540,000 barrels of crude oil and natural gas liquids each day. Line 5 is unique because it not only moves crude oil that is refined into transportation fuels, but it also transports natural gas liquids that are made into propane.

The project to relocate 41 miles of Line 5 off the Bad River Band’s Reservation is estimated to create over 700 Wisconsin union construction jobs, pump $135 million into the local economy, and bring with it millions in additional tax revenue. Line 5’s owner, Enbridge, has signed a letter of intent with Wisconsin-based Michels Pipeline, Inc. as the mainline contractor for the project.

The petition and letters submitted during the U.S. Army Corps of Engineers public comment period that ends on Friday come two years after the Wisconsin Department of Natural Resources held a similar public comment period on the Line 5 relocation. During the DNR public comment period, more than 11,500 Wisconsinites submitted comments urging the DNR to approve the project during a four-month DEIS public comment period in early 2002. An analysis of those comments, which were made public by the DNR, showed that by a 2-to-1 margin Wisconsinites supported the Line 5 relocation project.

Orders at U.S. factories for long-lasting goods, such as new cars or machinery, jumped 9.9% in July, the Commerce Department said Monday.

Orders have risen in five of the last six months. They dropped 6.9% in June on weak aircraft orders. Excluding the volatile transportation sector, orders were up 0.2% in July after a 0.1% gain in the prior month.

Federal Reserve Chair Jerome Powell signaled Friday that interest rate cuts are coming soon.

“The time has come for policy to adjust,” Powell said in his speech during the Kansas City Fed’s symposium in Jackson Hole, Wyoming. “The direction of travel is clear, and the timing and pace of rate cuts will depend on incoming data, the evolving outlook, and the balance of risks.”

“Inflation is now much closer to our objective, with prices having risen 2.5% over the past 12 months,” he said. “After a pause earlier this year, progress toward our 2% objective has resumed. My confidence has grown that inflation is on a sustainable path back to 2%.”

Powell did not go into specifics about the timing of when any rate cuts might occur.

The Fed is scheduled to meet three more times this year, in September, November and December.

Canada’s two major freight railroads have shut their operations, according to management of the two companies, locking out 9,000 members of the Teamsters union who operate the trains and dealing a potential blow to both the Canadian and US economies.

Nearly a third of the freight handled by the two railroads — Canadian National (CN) and Canadian Pacific Kansas City Southern (CPKC) — crosses the US-Canadian border, and the shutdown could disrupt operations in a number of US industries, including agriculture, autos, home building and energy, depending upon how long the shutdown lasts.

“CPKC is acting to protect Canada’s supply chains, and all stakeholders, from further uncertainty and the more widespread disruption that would be created should this dispute drag out further resulting in a potential work stoppage occurring during the fall peak shipping period,” the company said in a Thursday statement shortly after the start of the lockout at 12:01 am ET. “Delaying resolution to this labor dispute will only make things worse.”

The chambers of commerce in both the United States and Canada issued a joint statement Tuesday calling on the Canadian government to take action to keep the railroads working.

“A stoppage of rail service will be devastating to Canadian businesses and families and impose significant impacts on the US economy,” they said. “Significant two-way trade and deeply integrated supply chains between Canada and the United States mean that any significant rail disruption will jeopardize the livelihoods of workers across multiple industries on both sides of the border.”