On March 24, 2016 the PSCW issued for comment a draft of the Strategic Energy Assessment (SEA) for the years January 1, 2016, through December 31, 2022. The SEA evaluates whether Wisconsin will have an adequate and affordable electric utility system over the seven year study period, outlines ongoing issues to help Wisconsin maintain reliable electric service, and reviews issues that impact electric utility bills.
The PSCW prepares an SEA every two years. The report is based on data and information collected in 2015 from Wisconsin utilities and power cooperatives.
On July 19, 2016 CUB filed comments on the following topics:
The SEA shows that Wisconsin’s average electric rates for all sectors are the highest among Midwestern states and higher than the national average. In 2015, average residential rates in Wisconsin were 14.38 cents/kWh, versus 12.38 cents/kWh for the Midwest and 12.67 cents/kWh for the U.S. Across all electric customer classes, Wisconsin residents and businesses pay an average 10.93 cents/kWh, compared to the Midwest’s average of 9.66 cents/kWh and the national average of 10.42 cents/kWh.
CUB urged the PSCW to prioritize decreasing retail rates through cost control in rate cases. CUB said the Commission’s main focus going forward should be cost control, and decreasing rate levels whenever possible.
At its July 28, 2016 open meeting the Commission publicly discussed and finalized the Strategic Energy Assessment: Energy 2022 (SEA), Wisconsin’s biennial, statutorily-required report. The final SEA is now electronically available and can be viewed at https://psc.wi.gov/apps40/dockets/content/detail.aspx?dockt_id=5-ES-108.
In 2014, the PSC’s Quadrennial Planning Process established goals for energy efficiency programs for the 2015-2018 time period. CUB believes strongly that cost effective energy efficiency programs are the best line of defense against higher utility bills. A recent report shows that Wisconsin’s Focus on Energy program saves $3.41 for every dollar spent on energy efficiency and renewable energy programs. CUB retained national experts on the topic of evaluating energy efficiency programs and submitted comments to the PSC in this important case.
The PSC considered CUB’s and other stakeholder’s comments and found that the Focus program can be used to better position Wisconsin to cost-effectively meet federal carbon standards, with energy savings as the primary goal of the program. The PSC also determined that the 2015-2018 net annual energy savings goals will represent a 15 percent increase over the 2011-2014 historical baseline. The Commission deferred a decision on renewable energy goals until it receives a report on renewable programs in the fall of 2014.
On February 10, 2012, the PSC opened an investigation into the payments municipalities receive from municipally-owned utilities in lieu of property taxes. CUB is participating in this docket to make sure rates for customers of municipal utilities are reasonable, and submitted comments to the PSC in October 2012.
On December 23, 2011, the Public Service Commission opened an investigation regarding “customer service conservation spending” by the utilities. Since 2001, Wisconsin’s major investor-owned utilities have been spending $26 million annually on customer service conservation activities, which include a broad range of activities from answering customers’ questions about energy use to providing specialized engineering services to help customers save energy.
Back in 2000 and 2001, the PSC provided very little guidance for how the utilities were to spend these funds. Since customer service conservation spending is funded by ratepayers, the current Commission opened this investigation to determine whether this spending is in the best interests of utility customers.
CUB has submitted two rounds of comments, encouraging the PSC to require the utilities to create “voluntary” programs to house some of their activities, so that they can be evaluated for cost-effectiveness, just like energy efficiency programs offered by Focus on Energy. CUB has also recommended that the utilities clearly summarize and justify other customer service activities in their rate cases.
The PSC issued a decision in this case on July 13, 2012. The PSC decided that utilities no longer must spend $26 million on customer service conservation activities. Instead, utilities can propose conservation activities in their rate cases, and the PSC will review them for appropriateness, the process recommended by CUB. PSC staff are also to review utility conservation activities to ensure their effectiveness, and utilities should make the form of their proposals more uniform, also as recommended by CUB.
On June 30, 2011, the PSC started the next strategic energy assessment (SEA) for the years 2012 through 2018. The SEA compiles information about the status of Wisconsin’s electric power industry, and summarizes the plans of utilities to meet electricity needs through 2018.
The PSC issued a draft SEA on June 14, 2012. CUB and Clean Wisconsin submitted joint comments on the draft in September 2012, calling for the PSC to re-create an “integrated resource planning” process, which would require the utilities to periodically file 20-year plans showing how they would use generation, transmission, and energy efficiency to meet future electricity needs. Though CUB has made similar requests in the past, PSC Chairman Phil Montgomery and Commissioner Eric Callisto have expressed some support for planning.
The PSC issued the final version of the SEA in November 2012.
The PSC is investigating the current situation in which there are too many power plants operating in Wisconsin, leading to a situation known as “excess generating capacity.”
CUB and the environmental organization Clean Wisconsin believe that several old coal-fired power plants could possibly be mothballed or retired, reducing operation and maintenance costs to ratepayers, and reducing pollution.
CUB and Clean Wisconsin submitted comments on August 9, 2010, suggesting that the PSC conduct extensive computer modeling to determine whether any coal plants should be mothballed or retired. Commission staff are currently preparing materials for the case, which will be sent out for comment to the organizations participating in the proceeding.
Unfortunately, the case has stalled.
A new market for wholesale electricity opened on April 1, 2005 for many utilities in the Midwest, including most of Wisconsin’s utilities. CUB continues to represent residential consumer interests in various committees at MISO.
On May 16, 2008, the PSC opened an investigation regarding alternative rate designs and load management. CUB, Clean Wisconsin, and RENEW Wisconsin submitted joint comments in April 2009 asking the PSC to prohibit "aggregators of retail customers" to operate in Wisconsin until their activities can be assessed by all interested parties. On October 14, 2009, the PSC issued an order temporarily prohibiting these aggregators from operating in Wisconsin until further investigation.
The PSC re-opened this docket in February 2011, and has asked graduate students of the University of Wisconsin-Madison to write a report on demand response, which will be issued later in 2011. The report will describe the benefits and costs of demand response, as well as various strategies for implementation. The report will also summarize demand response activities in Wisconsin and other Midwestern states. CUB will provide comments on the draft report later in 2011.
In October 2010, the PSC issued a draft of its latest assessment of Wisconsin's supply of electricity. CUB and Clean Wisconsin submitted joint comments on the draft in January 2011, urging the PSC to include more information explaining why electricity rates have skyrocketed since 1997.
The PSC issued a final version of the SEA in March 2011, though it did not include the information on rates requested by CUB and Clean Wisconsin.
The PSC has opened an investigation regarding whether and to what extent regulations for local telephone service should be changed. CUB submitted comments on March 25, 2008 asking that the PSC consider policies that would make broadband Internet service more available and more affordable. CUB also suggested that consumer protections for any type of telecommunication service should be strengthened. CUB attended a PSC technical conference on May 28, 2008. CUB's expert witness Mark Cooper met with PSC staff on September 25, 2008 to provide staff with CUB's viewpoint regarding universal service and broadband. The PSC delayed issuing a draft report due to pending decisions by the Federal Communications Commission.
The PSC decided to close this investigation in February 2011, after deciding that it needs to take no action regarding deregulation at this time.
In February 2006, the commission requested comments from CUB, the utilities, and other stakeholders on whether the "fuel rules" should be changed given the volatility in natural gas prices. Drafting new fuel rules turned out to be an extremely complicated and drawn out affair, lasting nearly 5 years. At stake for ratepayers are potentially hundreds of millions of dollars in higher rates to cover the cost of fuel utilities purchase to produce electricity. What follows is a brief review of the many steps and political twists and turns that it took to promulgate new fuel rules.
When new rules were proposed by PSC staff in early 2006, CUB and the Wisconsin Industrial Energy Group quickly joined together in opposition, because the proposed rules greatly favored the utilities at the expense of ratepayers. After several rounds of comments by CUB, WIEG, and the utilities, new rules were drafted by the PSC in 2008, but were not sent to the Legislature for approval due to legal concerns raised by CUB and WIEG. Score: CUB & WIEG 1, Utilities 0.
In early 2009, the utilities attempted to undermine these legal concerns through legislation. Fearing that the utilities may have had the votes to get their fix through various committees, CUB and WIEG negotiated a compromise with the utilities that would allow the PSC to fuel costs for recovery or refund in the following year, while preserving a prohibition of automatic adjustment clauses. Legislation codifying this compromise, AB 600, was signed by Governor Doyle on May 18, 2010. Score: CUB & WIEG 2, Utilities 1.
Despite the passage of this legislation, the PSC still had to send the proposed rules to the Legislature for final approval. The PSC sent the revised rules to the Legislature in late August 2010, and the senate energy and utilities committee sent the rules back to the PSC in late October for further modification. The issue: Sen. Jeff Plale (D - South Milwaukee), the chair of the senate committee, wanted to protect the ability of the utilities to manipulate the fuel rules and force ratepayers to pay for bonuses paid to utility executives, which totaled $44 million above and beyond their salaries in 2009. The PSC has consistently prevented the utilities from having ratepayers pay for bonuses, so Sen. Plale's proposal would have harmed ratepayers. CUB and WIEG opposed this modification, but the PSC ultimately issued rules that may allow utilities to charge ratepayers for the outrageous bonuses paid to utility executives. These new rules took effect January 1, 2011. Score: CUB & WIEG 2, Utilities 2.
On October 23, 2009, the PSC opened this investigation in order to establish goals and funding levels for Focus on Energy, Wisconsin's statewide energy efficiency program. CUB participated in this docket to make sure appropriate goals and funding were established to support Focus on Energy and its energy efficiency programs.
CUB, Clean Wisconsin and RENEW Wisconsin submitted joint comments to the PSC in November 2009, June 2010, and September 2010, providing our recommendations for funding levels and policies that would allow Focus on Energy to make additional investments in energy efficiency.
Since 2001, Focus on Energy has helped more than 2 million Wisconsin residents and businesses save nearly $2 billion on their energy bills, above and beyond the cost of the Focus on Energy program itself. Focus on Energy also created the equivalent of over 2,400 full-time jobs since 2001.
In November 2010, the PSC sent a proposal to the Legislature's Joint Committee on Finance to greatly increase the funding levels for Focus on Energy. The PSC's proposal, strongly supported by CUB, Clean Wisconsin, and RENEW, would nearly double the funding for Focus on Energy for 2011 through 2014. The Joint Committee on Finance, approved the new funding levels for Focus on Energy in mid-December 2010.
On June 3, 2008, the PSC opened an investigation into whether ratepayers would benefit if utilities were able to "decouple" revenues from sales of electricity and gas. Decoupling is a controversial issue, because it can reduce risk for utilities regarding recovery of revenues from ratepayers, but this reduced risk may not be factored into reduced utility profit levels (less risk should result in lower profits). Proponents argue that decoupling could make utilities more willing partners in energy efficiency programs. CUB, along with Clean Wisconsin and RENEW Wisconsin, submitted comments on July 22, 2008. There has been no activity for several years.
In the summer of 2006, the PSC opened this docket to determine whether and how utilities should be able to recover costs that they have accumulated due to the regional electricity market administered by the Midwest Independent Transmission System Operator (MISO). CUB intervened to make sure that the utilities don't try to rig the methodology in a way that would raise rates to recover costs already included in rates. On August 30, 2007, the Commission ordered that to recover deferred MISO day 2 costs a utility must demonstrate in its next full rate case an overall increase in costs as a result of MISO Day 2. The Commission also ordered that utilities may not defer MISO costs unless they also defer MISO revenues to prevent the possibility of a utility over-collecting its costs.
On July 22nd, 2006, the Commission issued of Notice of Investigation requesting comments on how to narrow cost of service and rate design issues in rate cases. CUB and WIEG filed an extensive joint report addressing mutual and opposing positions on electric cost of service and rate design issues on August 29th. Each major utility also filed separate comments. Our September 12th reply comments requested that the Commission convene working groups for parties to further discuss differences of opinion on COSS methodologies and rate design principles. Now that comments are filed the question is "what will the commission do with it?", and the options don't necessarily bode well for residential customers. The reason for that is industry power and the complexity of the issues.
On November 9th, 2006, the Commission discussed this docket at an open meeting. The Commission decided that it could not make any decisions on the various proposals because of on-going rate cases, and that it did not want to prejudge any of the issues. The Commission kept the docket open stating that they need more information regarding the 12CP method and rate design issues.
There has been no activity in several years.
The PSC is revising the section of its administrative code that defines the standards by which utilities provide natural gas to retail customers, including issues of safety, service calls, customer service, disconnections, and reconnections. CUB is intervening to make sure customer needs are protected in this revision. On June 30, 2008, CUB submitted comments on proposed changes to the gas service rules codified in PSC 134. There has been no activity for years.
The case was recently revived. CUB attended a technical conference in February 2012 and will provide another set of comments in late Spring 2012. The PSC will likely decide the case by the end of 2012.
This docket examined the following issues:
CUB worked with Clean Wisconsin and RENEW in preparing comments in this case as the Joint Public Intervenors. The Joint Public Intervenors presented testimony at the public hearing in this docket and filed comments on the draft SEA.