Wisconsin utility regulators have signaled limited approval to a financing tool that advocates of clean energy say will expand access to solar power, but that utilities see as a threat to their monopoly position.
The Public Service Commission voted 2-1 Thursday to issue a ruling that a family can lease solar panels from a company other than a regulated utility.
The commission stopped short of granting blanket approval of a practice known as third-party financing, but clean-energy advocates hailed the ruling as a win that will discourage utilities from trying to block similar arrangements.
The goal of the project is to understand where air pollution is a problem, give people information to guide their health decisions and ultimately take actions to address health disparities.
Vote Solar, a California-based nonprofit, filed a request on behalf of a Stevens Point family that wants to install solar panels on their home to reduce their energy bills. To avoid the upfront cost, they want to lease panels from North Wind Renewable Energy Cooperative but asked the PSC to clarify the legality of the arrangement.
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Advocates say third-party financing is no different than leasing a car and that it could make solar energy available to more people, including residents who can’t afford the upfront costs and local governments, schools and nonprofit organizations that can’t benefit from federal tax credits.
Utilities and their allies have argued the arrangement amounts to deregulation and would “upend 115 years of Wisconsin regulatory law” and open the door to “retail competition.”
Wisconsin law says that public utilities are subject to regulation by the PSC, but the definition is ambiguous: any entity providing “heat, light, water or power ... to or for the public.”
The commission voted to issue a ruling declaring that the family is not “the public” and that the lease agreement does not make North Wind a public utility.
Wisconsin law says homeowner associations can’t restrict peoples’ rights to install solar panels on their property. Many do it anyway.
Commissioner Ellen Nowak, the lone Republican appointee, sided with utilities and warned against falling for a “bait-and-switch scheme” by approving the single case.
“What they want to do is to sell energy,” Nowak said. “The commission should see this petition for what it is: a request to change the law.”
Valcq
Chair Rebecca Valcq questioned how solar panels are any different from backup generators.
“Would we be having such a ferocious debate if the petitioner was Generac?” she asked. “It’s the same business model.”
Decision praised
Environmental advocates hailed the decision as “a victory for both common sense and the environment.”
“Utilities should be working to expand solar access — not seeking out flimsy legal loopholes to prevent it,” said Will Kenworthy, Midwest regulatory director for Vote Solar. “We’re thrilled to see the commission make the right choice for this family, and hope the state will continue to build on this momentum by affirming that third-party financing is an option for all Wisconsinites.”
Vickerman
Michael Vickerman, policy director for Renew Wisconsin, called the ruling a “very positive development.”
“The order will apply to that family, but the implications are broader than that,” Vickerman said. “It sends a signal to the utilities that you better be very, very careful here if you want to be resistant.”
‘Opens the door’
A spokesperson for a utility trade group said the ruling signals a policy shift that should be left to lawmakers.
“It’s not the ruling we were hoping for,” said Bill Skewes, executive director of the Wisconsin Utilities Association. “Narrower is better than broader, but our concern is that it opens the door to a wider effort to erode the regulatory compact.”
Rob Richard, director of government relations for the Wisconsin Electric Cooperatives Association, said he expects the ruling will end up in the courts.
“The decision to alter Wisconsin regulatory law after 115 years should only be done in the state Capitol by the Legislature,” Richard said.
Next steps?
Kenworthy said he is awaiting the final written order to know whether other customers wanting to enter third-party agreements would need to go through the same petitioning process, which can take months and involves hearings and legal filings.
“If this goes all the way to solve the problem, great,” he said. “If not, we’ll think about what else we need to do.”
Madison's efforts to restore a 26-acre urban greenspace has sparked outrage and suspicion among neighbors and questions over the value of trees in a changing climate.
The commission has yet to decide on a similar petition from the Midwest Renewable Energy Association, which sought a declaration covering all customer-hosted energy resources, including batteries, smart thermostats and controllers.
Regulators voted last month to extend the timeline in that case to allow the introduction of additional evidence.
Previous commissions have rejected at least three petitions for declaratory rulings on the question of third-party financing, with conservative appointees arguing that is the Legislature’s job.
A Republican bill to explicitly allow solar leasing was introduced last year but failed to pass.
MREA last year sued the commission, arguing it had overstepped its authority by effectively preventing third-party financing agreements, but the case was dismissed.
The commission did consider a petition from Eagle Point Solar, an Iowa company whose agreement to install solar panels for the city of Milwaukee was blocked by We Energies, but Tyler Huebner recused himself from that case and the other commissioners deadlocked.
Power lines: The battle over Cardinal-Hickory Creek
A joint venture of American Transmission Company, ITC Midwest and Dairyland Power Cooperative, Cardinal-Hickory Creek is a 102-mile transmission line between Dubuque and Middleton.
Utilities and some environmental groups say the line will deliver cheap, clean wind energy from Iowa. Opponents question the value, arguing there are lower cost alternatives that won't mar the scenic Driftless landscape.
The project has been the subject of multiple lawsuits in both state and federal court.
The U.S. Department of Agriculture will host meetings March 13-20 to hear comments on its environmental review of the high-voltage line known as Cardinal-Hickory Creek, which would connect Dubuque and Middleton.
As the Public Service Commission grapples with another controversial power line some opponents question whether the law allows enough time to thoroughly vet the $500 million Cardinal-Hickory Creek project.
Members of the public can offer opinions on the $500 million high-voltage transmission line known as Cardinal-Hickory Creek during meetings June 25-27 in Madison, Dodgeville and Lancaster.
Wisconsin Democrat calls on the Department of Agriculture’s Rural Utilities Service to conduct “a meaningful analysis” of alternatives to the 345-kilovolt transmission line as well as other possible spots to cross the Mississippi River.
Attorneys for the utilities have sought to question Driftless Area Land Conservancy executive director David Clutter and to force the land trust to turn over eight years of internal communications regarding the line and to identify “the individual/s that first proposed having DALC oppose the Project.”
As intervening parties, they will be able to offer testimony from expert witnesses, cross-examine witneses and request information -- including trade secrets -- from the applicants, American Transmission Company, ITC Midwest and Dairyland Power Cooperative.
The Wisconsin Democracy Campaign says employees of two utilities made more than $338,000 in political contributions between 2010 and 2017.
The Driftless Area Land Conservancy is expected to file a request Wednesday with the PSC for $80,000 to cover half the cost of hiring the experts. The nonprofit conservation group will raise the other half.
The government shutdown created some confusion about the meetings, which are still listed on the USDA website. Agency phones went unanswered Tuesday, and outgoing messages indicated furloughed employees do not have access to email or voicemail.
If plans for the line are canceled for reasons beyond their control the owners would be allowed to bill consumers for all “prudently incurred costs."
If approved, the $500 million Cardinal-Hickory Creek high-voltage power line would alter the landscape and the way of life for scores of families and businesses.
Conservation and environmental groups say the U.S. Department of Agriculture failed to consider alternatives in its draft environmental review.
The Wisconsin Public Service Commission on Thursday declared the Cardinal-Hickory Creek application complete, triggering a 180-day review period of the project, which has an estimated price tag of more than $500 million and is expected to cost Wisconsin consumers up to $72 million.
Three utility companies want to build a 345-kilovolt transmission line from Middleton's Cardinal Substation to Dubuque, Iowa.
Developers of the planned Cardinal-Hickory Creek transmission line from the Madison area to Iowa have shrunk the two corridors under consideration.
Approved Cardinal-Hickory Creek transmission line route
Conservation groups oppose the line, known as Cardinal-Hickory Creek, which would run 102 miles between Dubuque and Middleton.
Conley cautioned utilities are risking more than $500 million in ratepayer money and he will not allow them to build in protected areas “simply because the transmission companies plowed ahead" with no guarantee of a river crossing.
The court found Huebsch’s private communications with utility executives did not taint his vote in favor of the roughly $500 million project, nor did his later application to lead one of those utilities.
The utilities, which have so far spent about $277 million on the project, say the price of steel has essentially doubled in the four years since construction costs were estimated, while the aluminum and steel wires have gone up 68%.
The ruling could delay completion or drive up the cost of the $492 million Cardinal-Hickory Creek line.
The utilities argue a delay would increase construction costs, “compromise reliable operation” of the Midwestern power grid, and contribute to ongoing congestion that prevents the delivery of cheap wind energy from Iowa.
Continued construction of the power line in the face of the challenges “amounts to little more than an orchestrated train wreck," a federal judge said.
Wisconsin's three transmission utilities would be able to block competitors from bidding on projects within their territories, which opponents say would boost their profits at ratepayers’ expense.
Judge William Conley’s ruling throws the fate of the Cardinal-Hickory Creek transmission line into question just months after utilities began construction on the $492 million project.
Utilities had planned to begin building the line between Middleton and Dubuque, Iowa, on Oct. 25, according to court documents.
In a split decision issued Tuesday the high court agreed to hear Mike Huebsch’s challenge to subpoenas from power line opponents who sought to question him and inspect his phone for encrypted communications.
In a 6-1 order issued Monday, the high court said utilities can follow traditional procedure and ask the court of appeals to review the injunction.
The utilities announced they had begun work on the Wisconsin portion of the $492 million project despite an injunction temporarily prohibiting work on or near federally-protected waters.
Huebsch, a former state legislator and member of Gov. Scott Walker’s cabinet, says he’s the object of “unrelenting innuendo and harassment” in an effort to sway future decisions.
Judge Jacob Frost denied former Public Service Commissioner Mike Huebsch’s emergency motion to block a subpoena filed by opponents of the Cardinal-Hickory Creek transmission line.
Two voting members of the Public Service Commission deadlocked on a request from the owners of the Cardinal-Hickory Creek line to rescind and reissue a construction permit that is the subject of four separate court challenges.
American Transmission Co. and ITC Midwest filed a request Monday with the Public Service Commission to rescind the permit for the $492 million Cardinal-Hickory Creek transmission line and reopen the proceedings.
At issue is whether former Commissioner Mike Huebsch’s interactions with one of the project’s owners tainted his approval of the line, which the Public Service Commission authorized with a 3-0 vote.
Environmental groups sued the Army Corps of Engineers on Wednesday in federal court over its permitting of the $492M project known as Cardinal-Hickory Creek.
The groups claim the U.S. Fish & Wildlife Service violated federal law by authorizing the line, known as Cardinal-Hickory Creek, to cross the Upper Mississippi River National Wildlife and Fish Refuge, and the USDA’s Rural Utilities Service failed to consider alternatives in its environmental review.
The Public Service Commission filed an appeal Tuesday on behalf of Chair Rebecca Valcq and former Commissioner Mike Huebsch, who are named as defendants in the case brought by Driftless Area Land Conservancy and the Wisconsin Wildlife Federation.
Two groups suing to stop a $492 million power line have obtained text messages between a former regulator who approved the project and an executive of one of the utilities seeking to build it.
In his last five months on the PSC, Mike Huebsch voted to authorize two Dairyland-affiliated projects worth nearly $1.2 billion.
The counties filed a petition for judicial review Thursday seeking to overturn the Public Service Commission’s September order approving construction of the line known as Cardinal-Hickory Creek.
The lawsuit filed Wednesday by the Environmental Law & Policy Center challenges the decisions of Public Service Commission Chairwoman Rebecca Valcq and Commissioner Mike Huebsch to vote on the line known as Cardinal-Hickory Creek.
Iowa County supervisors this week voted 14-2 to spend up to $50,000 fighting the $500 million Cardinal-Hickory Creek transmission line approved last month by state utility regulators.
Commissioners denied there were conflicts of interest and accused power line opponents of waiting until after an unfavorable decision to bring forward allegations regarding information that was public months earlier.
The case attracted unprecedented interest, with more than 50 groups and individuals participating in the evaluation process, which drew hundreds of public comments, almost all of them opposed to the line.
Chris Hubbuch | Wisconsin State Journal
Covers energy and the environment for the Wisconsin State Journal. Rhymes with Lubbock. Contact him at 608-252-6146.
