Austin Utilities Board approves new utility rates for 2026

ROCHESTER, Minn. (KTTC) – Austin utility customers can expect their overall bills to remain about the same next year, despite increases in water and gas rates, thanks to a decrease in electric rates that officials say will balance out the changes.

The Austin Utilities Board of Commissioners approved the 2026 budget and rate adjustments Monday, with residential and small business customers seeing water rates increase 4.2% and gas rates rise 0.5%, while electric rates drop 1.9%.

“We understand that many of our customers are balancing the rising costs in other areas of their life,” said Tom Dankert, Austin Utilities General Manager. “By holding rates steady, we’re doing our part as an organization to support families and businesses.”

WHAT THE CHANGES MEAN FOR YOUR BILL

Electric Rates - Small businesses and homes will see a monthly service fee increase of $2.50; however, electricity usage costs will decrease by 5.4%. Large businesses will see monthly service fees rise up to $75, but usage costs will stay the same.

Water Rates - Small businesses and homes will see the monthly service fee raise by $1.40. Large businesses will face an average 13.7% increase in service charges, but usage costs should remain unchanged for all customers.

Gas Rates - Homes can expect to see an increase of $0.25. Business service fees will rise up to $35 per month as well. Usage costs, however, should also remain the same for all customers.

The utility says the electric rate decrease should offset the water and gas increases for typical customers based on 2025 usage patterns.

Sewer and storm water fees, which appear on utility bills, are controlled by the city of Austin and were not part of Monday’s rate decision.

The new rates will take effect in 2026.

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