Milwaukee families are getting squeezed from every direction. Groceries cost more, property taxes take a bigger bite out of household budgets, and insurance premiums keep climbing. Now another round of electric rate increases is on the horizon.
Wisconsin regulators have given preliminary approval to We Energies electric rate increases of approximately 3.9 percent in 2027 and another 3.5 percent in 2028. Final rates remain subject to the commission’s written order.
It’s understandable that people are frustrated. And Milwaukee City Hall believes it may have an answer. What if the city took over the electric company?
On November 6, Milwaukee’s Common Council voted unanimously, 15 to 0, to authorize $1.35 million in general obligation borrowing to study creating a municipally owned electric utility. Alderman Alex Brower has championed the idea, arguing that public ownership could lower electric rates and provide greater local control.
Those are worthwhile goals. But before considering a potentially multibillion-dollar purchase, residents deserve to know whether government ownership would deliver those benefits.
The Problem Isn’t Just High Rates. It’s Having No Choice
Think about how most businesses operate. If your grocery store raises prices too much, you can shop elsewhere. If your cellphone provider gets too expensive, you can switch carriers. Competition encourages businesses to control costs, improve service, and respond to customers.
Electricity works differently. If you’re unhappy with We Energies, you can’t simply choose another company to deliver electricity through your neighborhood’s power lines. We Energies operates within a government-regulated system granting it an exclusive service territory.
There’s a practical reason for this arrangement. Building competing electrical networks down every street would be enormously expensive. Economists call this a natural monopoly.
Wisconsin attempts to protect customers through the Public Service Commission, which regulates electric rates and utility investments. But regulation isn’t competition.
Municipal ownership supporters argue that a public utility would answer to residents rather than shareholders. That’s a legitimate distinction. However, changing ownership wouldn’t eliminate the monopoly. Milwaukee residents would still depend on one provider, only now controlled by City Hall.
$1.35 Million Before the First Power Line Changes Hands
The Common Council hasn’t approved purchasing We Energies’ infrastructure. It authorized borrowing $1.35 million to investigate whether an acquisition makes financial and operational sense. A task force would oversee the study, although the approved amendment doesn’t identify a separate budget for that group.
Brower has suggested repaying the borrowing over approximately five to six years. The city would owe principal and interest even if the study recommends against purchasing the utility.
Think of borrowing money to hire consultants to determine whether you should buy a business. You haven’t purchased anything, but you’ve already taken on debt.
The city must issue a request for information or qualifications from outside experts by February 1, 2027. Study funding cannot be released until that solicitation process is complete. As of November 12, Mayor Cavalier Johnson has until November 17 to exercise his budget veto authority.
Any acquisition would require additional legal procedures, including a public referendum and Public Service Commission involvement. Milwaukee cannot simply take possession of We Energies’ infrastructure.
What About the Infrastructure Milwaukee Already Owns?
Milwaukee already faces substantial challenges maintaining its existing infrastructure. A 2025 Department of Public Works report identified approximately 1,370 lane miles of streets in poor condition. The estimated cost of bringing them up to good or excellent condition was $821 million.
That’s nearly a billion dollars in identified street improvements before City Hall assumes responsibility for a single electrical transformer.
The street backlog doesn’t prove Milwaukee couldn’t operate an electric utility. But it raises a reasonable question about priorities and administrative capacity. With major infrastructure needs already competing for resources, should City Hall expand into another capital-intensive operation without demonstrating that it can manage the additional obligations?
What Happens If Milwaukee Borrows Billions?
We Energies has warned that purchasing its electrical infrastructure within Milwaukee could cost billions, with annual operating expenses potentially exceeding $100 million. Those are estimates from a company opposing the proposal, not independently established figures. The actual purchase price remains unknown.
Consider a hypothetical example. Suppose Milwaukee borrowed $2 billion to purchase the electrical system, financing it over 30 years at 5 percent interest. With fixed monthly payments, the city would owe approximately $10.7 million monthly, or $128.8 million annually.
Over 30 years, interest alone would total approximately $1.87 billion. Add the original borrowing, and total repayment would approach $3.87 billion, nearly twice the amount borrowed. That figure represents cumulative debt payments, not an additional purchase price. It also excludes salaries, electricity purchases, equipment replacement, maintenance, and storm repairs.
These figures illustrate borrowing costs, not a forecast of Milwaukee’s acquisition terms.
The city would also acquire an operating utility with customers, infrastructure, and revenue. Supporters suggest financing an acquisition through revenue bonds backed by electric bills rather than general city taxes. Depending on the structure, that could limit property taxpayers’ direct exposure.
Nevertheless, customer revenue would need to cover operating expenses, infrastructure investments, and debt payments. Could Milwaukee meet those obligations while delivering lower rates and reliable service?
That’s what the feasibility study must establish.
Government Ownership Doesn’t Make Expenses Disappear
Supporters make a legitimate argument. A city-owned utility wouldn’t distribute profits to private shareholders, potentially creating savings. Municipal utilities may also benefit from financing advantages and greater local control.
But eliminating shareholder profits doesn’t eliminate operating expenses.
Imagine purchasing a restaurant. You might eliminate the previous owner’s profit and operate more efficiently. But employees still need paychecks, food must be purchased, equipment requires maintenance, and the building needs upkeep. If you borrowed millions to purchase that restaurant, you’d have loan payments, too.
Electric utilities operate under the same basic economic realities. Power lines break, transformers need replacing, and employees expect compensation.
Public ownership might save money. The question is whether those savings would outweigh acquisition costs, financing, operations, and long-term financial risks.
Lessons From Other Communities
Municipal takeovers aren’t unprecedented. In 2005, Winter Park, Florida, purchased its electric distribution system from Progress Energy for approximately $42 million after voter approval. Winter Park subsequently reported improved reliability, demonstrating that municipal ownership can work.
Boulder, Colorado, offers a different experience. After years pursuing municipal ownership and incurring substantial legal, engineering, and planning expenses, voters approved a new franchise agreement with Xcel Energy in 2020 rather than completing the takeover.
Neither example predicts Milwaukee’s outcome. The communities differ in size, infrastructure, and financial circumstances. But both deserve consideration when evaluating the potential benefits and costs.
Who Pays When Government Gets the Numbers Wrong?
Every organization makes mistakes. Businesses underestimate costs, managers approve unsuccessful projects, and equipment fails unexpectedly.
In competitive markets, poor decisions can cost investors money and drive customers elsewhere. Electric utilities face different pressures. Private regulated utilities can recover certain approved expenses through rates, while municipal utilities can seek rate increases or additional financing when costs exceed expectations.
Government ownership introduces political considerations. Would elected officials approve unpopular rate increases when necessary? Would essential maintenance take priority over politically attractive projects? Local accountability has value, but it doesn’t eliminate financial risk.
There’s another question. Suppose Milwaukee purchases the system, borrows billions, and eventually struggles financially. Could City Hall turn to Madison for assistance?
Wisconsin already provides municipalities with shared revenue funding, although restrictions apply to certain uses. A struggling municipal utility wouldn’t automatically qualify for a state bailout, and revenue-bond agreements could limit available remedies.
That doesn’t mean a bailout is inevitable or that Wisconsin taxpayers are automatically responsible. Any special state assistance would require a separate government decision. But the possibility underscores why Milwaukee’s study should identify exactly who bears the financial risk, whether electric customers, the city’s general budget, or potentially taxpayers elsewhere in Wisconsin.
Why Not Explore More Competition?
Government ownership isn’t the only response to high electric bills. Electricity involves generating power, selling it, and delivering it through local wires. Those activities don’t necessarily require the same company.
In some states, customers choose among competing electricity suppliers while using the same local distribution network. Think of delivery companies sharing a road. You don’t need three separate roads to have three competing businesses.
Electricity markets are more complicated, and retail competition has produced mixed results. Wisconsin should examine those experiences rather than assume competition automatically guarantees lower rates.
The state could also review regulations affecting independent electricity generation and homeowners’ ability to produce or store their own power.
Where practical, greater consumer choice can encourage businesses to control costs and improve service. Those possibilities deserve examination alongside municipal ownership.
The Real Power Should Belong to Residents
A serious feasibility study could provide valuable information, but it shouldn’t assume municipal ownership is the preferred outcome. It should examine acquisition costs, financing, operations, infrastructure, legal requirements, and likely customer rates. It should compare public ownership with reforms to the existing system using consistent assumptions about cost, reliability, and risk.
Milwaukee families have every reason to question rising electric bills. We Energies shouldn’t escape scrutiny simply because it’s privately owned. A government-regulated monopoly isn’t the same as a business competing freely for customers.
But dissatisfaction with the existing system doesn’t establish that government ownership would be better.
Before committing billions, Milwaukee needs a clear accounting of the benefits, costs, and risks. Residents deserve a meaningful opportunity to evaluate those findings before any final decision.
The goal should be reliable electricity at a reasonable price, greater accountability, and protection from unnecessary financial risk. Milwaukee doesn’t need a different name on the electric bill nearly as much as it needs a system that puts customers first.
The real question isn’t whether City Hall should have more power. It’s whether Milwaukee residents should have more control over theirs.
