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Power supplier cuts budget to hold down costs

Our power supplier, WPPI Energy, has reduced its 2009 budget and instituted a number of measures to control costs.

The modifications are projected to reduce the total 2009 revenue requirement to be collected from WPPI Energy member utilities by about $25 million.

“We recognize that people are facing difficult challenges because of the current recession, and we all must do what we can to mitigate the effects of the economic downturn,” said WPPI Energy President and CEO Roy Thilly. “It is important to note, however,” Thilly stated, “that the budget reductions WPPI Energy is making will help keep power costs reasonable, but these changes may be offset or more than offset by a variety of other factors.”

The WPPI Energy executive committee recently approved an 8.5 percent reduction to the Sun Prairie-based municipal power supplier’s combined administrative and general and operation and maintenance budgets. WPPI Energy also estimates that it will see a 6.7 percent reduction in the cost of purchased power and fuel, primarily driven by lower than anticipated loads due to the economic downturn.

WPPI Energy member utility and retail customer actual power costs will depend on weather, changes in fuel and market energy prices, and difference in actual load experienced. These factors may drive up the cost of energy despite budget cuts.

As a public power, nonprofit power provider, WPPI Energy’s rates are based on actual costs incurred and do not include a return on equity.

“While we cannot control major energy cost drivers such as fuel prices, weather and wholesale power markets, we must be frugal and act prudently to reduce where we can,” said Thilly. “We also need to help customers keep their electricity bills down through aggressive and effective conservation and efficiency programs and make smart resource decisions that enable us to provide reliable, affordable energy in an environmentally responsible manner over the long term.”

WPPI Energy is a regional power company serving 50 customer-owned electric utilities. Through WPPI Energy, these public power utilities share resources and own generation facilities to provide reliable, affordable electricity to more than 190,000 home and businesses in Wisconsin, Upper Michigan and Iowa. Visit www.wppienergy.org for more information.

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