Utility Rate Cap Bill
The Problem: Basic Utilities are Increasingly Unaffordable
Utilities are unaffordable for many Wisconsinites.
Working class households and communities of color have the least disposable income yet live in older houses and apartments that are less energy efficient, and therefore more expensive to heat and cool. The result is the families least able to afford it pay the largest proportion of their income on utilities. Most cannot afford to pay more than 5% of their income for utilities and accord other basics. But many pay 6% of their incomes and more (even 10% to 15%), being forced to choose between heat and lighting and other necessities such as rent, food, and medical care. This is why many communities dread April 15th, when it is legal for utilities to cut off service to homes that are behind on their bills.
The Cause: The Energy System is Rigged Against Us by Big Utilities
Home electricity and heating is controlled by utilities which prioritize profits over all else. In 2022 alone, Wisconsin’s five largest energy utilities reported a combined $1.3 billion in profits. The burden of these windfall profits falls squarely on Wisconsin families. Exploiting their lucrative government-mandated monopoly over necessities of modern life, big for-profit utilities are the driving force behind high prices for heating and lighting our homes and fossil fuel emissions that are driving the climate crisis.
Here is how the big utilities rig the system against all of us to jack up prices and make the climate crisis worse:
(1) Wisconsin Utilities Refuse to Make Older Homes More Energy Efficient. While utilities in neighboring states such as Illinois are alleviating this problem of older energy inefficient housing by providing financing for energy efficiency upgrades and rooftop solar panels, Wisconsin utilities are refusing to do so.
(2) Utilities Profit From Blocking Energy Efficiency, Rooftop Solar and Community Solar. The way the system has been set up to benefit big utilities, there is a perverse incentive: the more energy is wasted the richer they become. By keeping homes and apartments energy inefficient, and denying access to cheaper renewable energy, Wisconsin utilities are able to force us to buy more electricity and gas. This excess energy use allows them to justify huge new fossil fuel plants we don’t need that pad their profits. We get left holding the bag, subsidizing these new plants through higher energy bills for the next forty years.
(3) Utilities Profit by Making the Climate Crisis Worse. Excess energy use and unnecessary fossil fuel plants massively increase greenhouse gas pollution, making runaway climate change much more likely and risking our environment and our children’s future.
The Solution: Passing a Utility Rate Cap Law
Several states have laws capping the percentage of income people have to pay for utilities. Wisconsin has no limit. Citizen Action members are working with State Representative Darrin Madison on a bill that will cap the percentage of income households must pay for electricity and heat to the affordable level of 2% of income. The bill is a win-win for family budgets and for the environment.
- A Rate Cap Guarantees Utilities are Truly Affordable. By capping electricity and heating costs at an affordable percentage of household income, everyone regardless of their wealth or the age of their house or apartment will be guaranteed they can afford a vital necessity of life without sacrificing other necessities. Working class communities will no longer have to worry about their lights being shut off after April 15th every year.
- A Rate Cap Will Help Address the Climate Crisis. Big Utility profit motive will be aligned with the financial interests of Wisconsin families and the pressing need to slash greenhouse gas emissions. Eliminating the perverse incentive where big utilities profit from excess energy use, the rate cap will force them to choose between reduced profits and helping improve the energy efficiency of our homes and providing access to rooftop solar, community solar, and other renewable energy, reducing greenhouse gas emissions.
Join Our Movement
Citizen Action of Wisconsin believes that energy is a basic right, not a luxury. Together, we can break the stranglehold of utility companies and build a more just, sustainable future.
Join us in the fight for a 2% rate cap and take back control of our energy system. With your help, we can ensure that all Wisconsinites have access to affordable, clean energy—today and for generations to come.
For Citizen Action’s Strategy and Theory of Change see Explainers on Radical Pragmatism and Agenda Setting.
To join our organizing fighting climate change, contact: Kat.Klawes@citizenactionwi.org
