LANSING — Lansing Board of Water & Light officials say they are proposing a fifth consecutive year of rate hikes, albeit the smallest in years, because of rising costs associated with inflation, aging infrastructure and maintaining reliable utility services.
The potential hikes are 2.1% — or an average of $2 per month — for residential electric customers, and 2.39% to 3.34%, depending on average usage — or around $1 a month — for residential water customers.
Utility officials explained their reasons for pursuing the hikes during a Saturday, Aug. 1, hearing that detailed the cost of providing electricity and water to about 160,000 residents in the Lansing area.
Their slideshow presentation included, for example, the increasing costs since 2019 of providing a utility pole — from a 77% increase for guy wire to a 550% spike for wire cable.
Commissioners are scheduled to vote Aug. 11 on the proposed increases that could take effect in October.
One person spoke during the public comment session, mentioning the control of monopolies. Customers have another chance to speak to the proposed increases at a 5:30 p.m. Tuesday, Aug. 4, hearing at BWL’s REO Depot, 1201 S. Washington Ave.
“I didn’t expect a lot of people because the actual increased dollar amount on their bill is not all that significant,” said David Price, BWL’s commission chair. “If we were looking at what some of our brother and sister organizations are doing, at 10%, I think we would have gotten a lot more people. Of course, we’re not going to do anything like that.”
Here’s more to know:
History of BWL rate increases
The last year BWL did not have a rate increases was 2021. Electric customers have since seen annual increases of 2.05% in 2022 and 2023, 6.95% in 2024, and 6% in 2025. Water customers after 2021 have seen annual increases of more than 9%.
While the proposed hikes are relatively small, this could be the fifth consecutive year BWL enacts rate increases if the latest ones are approved.
Here’s how electric rate increases, on average, break down for the last five years and what’s being proposed.
2021 – No increase
2022 – 2.05%
2023 – 2.05%
2024 – 6.95%
2025 – 6%
2026 – 2.1% (proposed)
Here’s how water rate increases, on average, break down for the last five years and what’s being proposed.
2021 – No increase
2022 – 9.5%
2023 – 9.5%
2024 – 9.23%
2025 – 9.16%
2026 – 2.39% to 3.34%, depending on usage (proposed)
Are BWL increases higher than other utilities?
BWL General Manager Dick Peffley discussed the utility’s proposed rate strategy and utility industry trends during a May Committee of the Whole meeting.
According to meeting minutes, “he noted the proposed 2% electric rate increase is significantly lower than theincreases being experienced by many Michigan utilities, which are averaging approximately 5% or higher, with some utilities seeking increases near 10%.
“It was emphasized that the proposed strategy supports the BWL strategic goals while remaining below inflation and reflects the organization’s philosophy of growing revenue through new customer growth rather than placingadditional burden on existing customers.”
In April, DTE requested a $474 million rate increase for its 2.2 million customers. In June, Consumers Energy asked for a $456 million rate increase for its 6.8 million customers.
Increasing costs drive rate increases, BWL officials say
Price, the commission chair, said at Saturday’s hearing that BWL can’t get around rising costs and the continued need to provide electricity and water.
“Inflation is a big cost. Fuel that we use is a big cost,” he said. “You have labor increases — all things that all industries are dealing with.
“We try to keep prices as low as we can. Obviously, we’re sensitive because we’re owned by the city of Lansing. Our slogan is, ‘Hometown people, Hometown power.’ But we also try to address those customers who have issues in paying their bills. We don’t take it lightly, but we also have to provide the service.”
For example, BWL’s slideshow presentation noted that BWL customers received more than $4.3 million in utility payment assistance between November 2023 and June 2026.
For more information, visit lbwl.com.
Contact editor Susan Vela at svela@lsj.com or 248-873-7044. Follow her on Twitter @susanvela.
This article originally appeared on Lansing State Journal: BWL proposes electric, water rate hikes. How much more you could pay
Reporting by Susan Vela, Lansing State Journal / Lansing State Journal
USA TODAY Network via Reuters Connect
By Susan Vela, Lansing State Journal | USA TODAY Network
