Regulators have approved the sale of the remaining half of a 300-megawatt solar farm under construction in southwestern Wisconsin to Madison Gas and Electric and We Energies.
The two utilities will pay a combined $207.6 million to Invenergy, the Chicago-based developer of the Badger Hollow Solar Farm, which is one of the state’s first large-scale solar projects and will be one of the largest east of the Rocky Mountains.
The Public Service Commission voted 2-0 to authorize the purchase Thursday, agreeing with the utilities’ assertion that the solar farm is the lowest-cost means of meeting their capacity needs.
With the additional purchase, MGE will own a third of the Iowa County project, which is expected to come online by the end of this year. Subsidiaries of the WEC Energy Group will own the rest.
MGE used computer modeling to compare Badger Hollow to a range of other generation options — including coal, nuclear, biomass and a share of Alliant Energy’s Riverside natural gas plant — and found solar to be the lowest-cost scenario.
WEC reached the same conclusion using a less robust analysis, arguing that the computer model used by MGE doesn’t work for a regional energy market.
PSC Chairwoman Rebecca Valcq said she expects a more thorough analysis.
“I don’t think spreadsheet analyses are robust enough,” Valcq said. “It’s time that we look at different ways to model.“
The Citizens Utility Board, which represents consumer interests, agreed with MGE’s assertion that the project would be a good value for its customers but stopped short of endorsing WEC’s purchase because of the lack of modeling.
The cities of Madison and Milwaukee both endorsed the proposal, arguing it would help meet their renewable energy goals.
The PSC approved construction of Badger Hollow last year and separately authorized MGE and Wisconsin Public Service of Green Bay to buy half of Badger Hollow and all of the 150-megawatt Two Creeks solar farm in Manitowoc County for a combined $389.7 million.
As it did last spring, the commission authorized the utilities to take over Invenergy’s permit with all conditions attached, meaning the utilities cannot expand the scope of the project or use powers of eminent domain to take private property.
The commission denied a request to approve up to 10% in cost overruns, arguing the utilities were seeking permission to purchase something that was previously permitted as a wholesale merchant plant.
If the utilities themselves applied for permits, the commission would have had to evaluate the need, economics and engineering — alongside alternatives — rather than simply determining where to put the solar panels.
Ratepayer advocates have complained that the two-step application process circumvents the intention of the law.
“To the extent they run into overages they have the ability to come to us in a rate case and explain why costs exceeded what they put in their application,” Valcq said.
Commissioners rejected a labor union request that the utilities be required to report where their workers come from and their efforts to recruit local labor. The Wisconsin Laborers’ District Council complained that Invenergy has relied mostly on out-of-state workers.
“If this commission starts to apply conditions about where workers should come from we’re way out of our lane,” said Commissioner Ellen Nowak. “It’s not within our authority.”
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