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Madison council suspends electric utility dividend for 2025 amid $3.8M cost increase
Summary
Citing a projected $3.8 million increase in electricity-related costs driven by PJM capacity and transmission charges, Madison’s council voted unanimously to suspend the electric utility dividend for 2025 and discussed solar, battery storage and time-of-use pilots as mitigation options.
The Borough of Madison’s council voted to suspend the municipal electric utility’s dividend for 2025 after staff forecast a $3.818 million increase in electricity costs next year driven by higher PJM capacity and transmission charges.
CFO Jim Burnett told the council that the utility faces rising costs across three components: the electricity itself, transmission (the “highway tolls” that deliver power), and capacity charges — the latter expected to increase by over $2 million in 2025 and again in 2026. Burnett said Madison’s utility is in a strong financial position and the administration can balance the budget this year without raising customer rates by suspending the dividend that has returned roughly 8–9% of an average bill in prior years.
During the presentation and subsequent council discussion, staff outlined several mitigation strategies: completion of a solar carport at the MRC that will lower purchased capacity over time, potential grid-scale battery storage to shave peak demand, voluntary time-of-use pilot rates, and exploration of additional behind‑the‑meter generation. Burnett explained that a 5‑megawatt battery, for example, could reduce the town’s capacity charges by dispatching stored energy during peak events.
Council members emphasized the borough’s relative financial strength compared with investor-owned utilities, noted the administration’s careful purchasing, and asked for continued communications about program impacts. Council voted on a motion to accept the CFO’s recommendation to suspend the dividend for 2025; the motion carried by unanimous voice vote.
The administration said the targeted $200 rebate program for income‑eligible residents is not affected and will continue to be funded. Staff indicated the suspension will give the administration authority starting Jan. 1 to change utility billing mechanics for the coming year; further budget hearings on electric appropriations will continue over the next months.
