City Steam

Have you ever seen a fourteen-story boiler? Yep, you read that right. FOURTEEN STORIES.

It takes FOUR of these monster-sized boilers to supply much of the City of Milwaukee’s downtown buildings with steam heat. All that steam comes from a centralized plant located in the Menomonee Valley and owned by We Energies. The facility provides water and atmospheric heat for 450 downtown Milwaukee buildings, all while producing electricity as a byproduct of the steam generation. The Valley facility is the largest utility-owned co-generation plant in the entire United States – and it’s right in the backyard of our Reliable Water Services HQ! Seems like city steam heat runs most everything in downtown Milwaukee, just like it has since the mid-1800’s.

It’s called district heating and it can be found in many forms and in cities all over the world. New York has the largest commercial steam system in the United States, serving over 100,000 commercial and residential customers. Our Reliable Water Services’ Indianapolis customers might not be aware that much of the Indianapolis downtown loop is powered by steam heat sold to the utility from various sources, which are typically environmentally friendly.

The Milwaukee Steam Situation

There’s an important discussion surrounding city steam in the City of Milwaukee lately, as We Energies is looking to increase steam charges by 6% in 2013 and by another 6% in 2014. These costs will continue to increase, resulting in an anticipated 23% total increase in downtown Milwaukee city steam rates over the next five years. Commercial and residential electricity costs are also expected to increase. These increases are partially meant to offset the costs of converting the Menomonee Valley plant from coal power to natural gas – a move praised by local environmental groups.

Naturally, many downtown building owners aren’t too happy about the rate increase. This complicated issue is still being reviewed and revised by the Citizens Utility Board, and requires approval by the Public Service Commission of Wisconsin. The approval will likely happen by Thanksgiving, with rate increases beginning January 2013.

Keep That Money in Your Pocket

So, downtown building and business owners: now’s the time to be proactive and reevaluate your out-of-pocket costs for the upcoming years. Will these rising steam costs affect your business, your properties, your residence, your place of worship?

While the steam and electricity costs will likely go up, the cost of natural gas is actually decreasing under the same initiative. So that’s the good news in all of this.

Regardless of how the rate hike situation turns out, in this time of uncertainty, you have options when it comes to your budget. Right now you have an opportunity to plan for a variety of possibilities affecting your future capital expenditures and operating costs.

One alternative: you can opt out of your steam problems for good by installing your own boiler. Depending on your regular operating costs, switching to an independent boiler system might not be as much money out of your pocket as you might think. With an affordable protection plan from Reliable Water Services, you may be able to make the switch from city steam to a natural-gas-powered boiler without significant upfront costs.

Reliable Water Services can help you analyze your budget options, including potential alternatives to city steam dependency. You have choices. Discover and explore more water heating and steam heating options with Reliable Water Services.

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Note: Graphic courtesy of JSOnline article Downtown Businesses Rely on Steam Service, published 7/10/10. Featured image courtesy of Flickr user Robert Freiberger licensed under CC by 2.0.