Waupun Utilities Passes Tax Savings to Customers

Waupun Utilities is delivering savings to local customers as a result of the re-cently lowered federal corporate tax rate. Even though both our utility and our wholesale power supplier operate on a not-for-profit basis and do not pay feder-al income taxes, our transmission service and some of our power are purchased from companies that do. Those transac-tions are structured so that some of the companies’ tax savings are passed back to our utility, and we are returning our savings directly to customers of Waupun Utilities.

In March, the Board of Directors for WPPI Energy – Waupun Utilities’ not-for-profit, member-owned, wholesale power supplier – adjusted wholesale electric rates to ensure that the entire savings resulting from the new, lower federal corporate tax rate would flow back to WPPI Energy’s 51 member utili-ties.

Waupun Utilities General Manager Randy Posthuma is a director on the WPPI Energy board.

“We supported this measure because it benefits local residents and businesses,” said Posthuma. “The savings Waupun Utilities receives are flowing back to customers.”

In 2018, the impact of these savings is expected to lower wholesale rates to WPPI Energy’s member utilities by an estimated 3 percent. For Waupun Utilities, this translates into an anticipat-ed annual savings of more than $200,000.

Waupun Utilities returns its wholesale power cost savings to customers via the Power Cost Adjustment Clause (PCAC) on their monthly electric bills. The PCAC – which reflects variations in power costs driven by seasonal changes, fluctuations in customer demand, chang-ing fuel prices, and other factors, includ-ing tax-related savings – ensures that the utility’s wholesale costs are passed through to customers at neither a profit nor a loss.

STORY FROM THE WAUPUN UTILITIES SUMMER 2018 NEWSLETTER