We currently have a crisis happening in rural Wisconsin. Our beautiful countryside, our quaint villages, our recreational destinations and tourism economies, our vital farming communities who bring food to our table, are being devastated by industrial utility-scale energy expansion. There are a lot of slogans and PR about this development from investors and cleverly crafted statements about public interest from our PSC Commissioners. But, I want to introduce you to some of the realities of what is actually going on, and why this is not the right energy path for Wisconsin.
The Congress passed the Energy Policy Act in 1992, allowing FERC1 to manage electricity producers on the basis of market competition. While this had the effect of reducing the wholesale price of electricity from 5.6 cents to 2.9 cents (2005-2015) resulting in insignificant benefits to ratepayers,2 it allowed public utilities to push for increasing amounts of infrastructure at the public’s expense. Currently, the lion’s share of an electric customers bill is the result of this infrastructure debt.3 Not only are electric bills increasing rapidly4, but there is no end in sight to the infrastructure that utilities are proposing. As Integrated Resource Planning went away with deregulation, and those in charge of monitoring our utilities’ accountability to electric customers side overwhelmingly with utility interests,5 we have a runaway train. The recent situation in Texas exemplifies how deregulation combined with no accountability is a dangerous mix.
Over the last 20 years, Transmission Owners have aggressively pushed for new transmission, even while energy usage has become flat and is expected to remain so in the foreseeable future.6 In the wake of Transmission Expansion damage to: the economics of communities; the health and endurance of the environment and ecosystems; and the lives and welfare of landowners, follows a legion of investors seeking to change the face of rural America. These investors are here by virtue of significant Federal subsidies for renewable energy projects and a chance to access new high voltage transmission (to reduce interconnection costs for utility-scale wind and solar facilities). In Wisconsin, utility-scale wind and solar facilities are primarily merchant power plants. The influx of these merchant power plants has pushed our rural Wisconsin communities to critical mass.
How Merchant Power Plants Arrive in our Communities
Merchant plant developers sneak into our communities under the veil of darkness, waiving large checks in front of struggling farmers and land owners, in exchange for them signing away most of their property rights along with their neighbor’s rights as well.7 Land owners are not made aware of important lease contract conditions giving the Developer control over their entire property, or negative impacts of the project they are planning to construct. When the Developer has the signatures they need, they begin the process of seeking the minimal regulatory review that is required in Wisconsin, only then alerting unsuspecting communities of their project proposal. At this juncture, it is virtually impossible for communities to have any say in the disaster that is about to hit them.
Incentives for Utility-Scale Wind and Solar Facilities
The Federal Government gives subsides to the investors in renewable energy power plants. Without these subsides, these plants would not even be proposed. Investors in these merchant plants need to take only minimal, if any real risk in developing these projects, because they are frequently purchased by public utilities,8 adding rate recovery and guaranteed rate of return, to the public’s already steep utility debt. Because this is a lucrative investment scenario for developers, we have so many of these projects popping up9 that we are creating far more generation than we need.10
In Wisconsin, merchant power plants undergo virtually no regulatory scrutiny. Making this worse, the Wisconsin PSC allows public utilities to purchase these merchant plants, even before they have received a permit or CPCN.11 This is a loop-hole that the Commission is allowing public utilities to use,12 to skirt a full CPCN process that would require consideration of need, economic viability, alternatives to the projects and engineering considerations. In effect, the public is robbed of its opportunity to participate in decisions for which the public will be financially responsible and expected to bear the negative impacts of.
Corporate Land Grab
If we allow public utilities to acquire project after project from merchant developers, monopoly utilities will be the owners of large tracts of land in our communities. In Wisconsin, the 62 merchant power plants that are currently in the MISO queue, represent 340 square miles of directly impacted rural property which comes to 217,600 acres.13 What will happen when utilities own a controlling percentage of the property in a township or county? Will the Town or County board consider the will of the those actually living in these places or will utilities run the show at the expense of remaining landowners and residents? This is a very troubling possibility.
Addressing Climate Change
One might ask: How do we address climate change without these large wind and solar projects? Utility-Scale wind and solar will not save us from climate change. One reason for this is transmission. Our transmission grid is “open access,” meaning, the power that ends up in our outlets is determined by the electricity market. Fossil fuel sources frequently outcompete renewables in the market, which is why, after billions of dollars being spent on wind and solar projects and associated transmission, the percentage of power being delivered14 from these renewables is still less than 10%.15
Conversely, distributed generation (DG), primarily roof-top solar and solar plus battery storage, which generates electricity at or very near the customer using it, is much more efficient and cost effective. DG used directly at the home or business that has invested in it, is not subject to the transmission grid market and therefore 100% of that energy is used. The excess generation from a DG system, goes directly into a distribution line,16 where, in most cases, it travels a short distance before being delivered to another one the of local utility’s customers.17 Individuals and businesses who invest in DG generally employ energy efficiency, use minimization and often load management, to curtail their energy footprint. The outcome is far more carbon emission reduction per dollar than utility-scale power plants can provide.18 DG is not rate recovered and there is no guaranteed rate of return (profit), making it economical for ratepayers.
With the benefits of DG and the downsides of utility-scale power plants, it is natural to ask the question: “Why should we be covering good farmland with industrial structures and creating economic and environmental disasters for communities and landowners, when we could be putting solar panels on every roof, barn, business, over parking lots, etc., at a lower cost, with a greater benefit in carbon dioxide emission reductions? Why should the public “finance” a market for investors to profit on unlimited projects, for power that the public doesn’t even need?
Ultimately, individuals, businesses and communities will invest in roof-top solar and solar plus battery storage as a shear economic necessity (because electric rates will be so high). At that point, the public will still be on the hook to pay for the multitude of merchant plants for which no planning, or reasonable regulatory process has been required, even though these power plants will be obsolete. If we allow this to happen, our rural areas will be littered with large industrial factories, abandoned and leaving behind a staggering debt – Enron-Wisconsin style.
1 The Federal Energy Regulation Commission
2 Wisconsin Residential Electric Rates/National Average Rates/Wholesale Cost, p. 40, http://soulwisconsin.org/Resources/FootnoteHarbour.pdf#page=40
3 Spending Impacts on Rates, pdf p. 26, http://soulwisconsin.org/Resources/FootnoteHarbour.pdf#page=26
4 Wisconsin Residential Electric Rates/National Average Rates/Wholesale Cost, p. 40, http://soulwisconsin.org/Resources/FootnoteHarbour.pdf#page=40 Residential Electric Rates 2003-2015, pdf p.9, http://soulwisconsin.org/Resources/FootnoteHarbour.pdf#page=9
5 Governor Evers has now appointed both Rebecca Valcq, who has obvious entanglements with utility interests (longtime attorney for WE Energies, owner of the controlling share in ATC), and Tyler Huebner, who had so many conflicts of interest, that he had to recuse himself from 30 out of 39 cases that would come before him in his first year as a Commissioner. The Governor received a number of letters regarding the appointment of an objective and public sensitive Commissioner prior to this appointment. These appointments are very distressing to the public and continue to re-enforce a system that works for utilities and against the public (Evers nominates utility lawyer to PSC,” by Dave Cieslewicz, February 28, 2019 https://isthmus.com/news/news/can-psc-appointee-rebecca- cameron-valcq-be-unbiased/ “She is a lineman for the utilities, Evers’ Public Service Commission appointee sides with big energy” by Dave Cieslewicz August 29, 2019 https://isthmus.com/opinion/opinion/evers-public-service-commission-appointee-sides- with-big-energy/ New PSC Member Will Vote On Issues Affecting Former Employer, MacIver News Service, March 19, 2020 https://www.maciverinstitute.com/2020/03/new-psc-member-will-vote-on-issues-affecting-former-employer/
6 Wisconsin Electricity Use Dropping, 2001-2021 See EIA data, pdf p. 51, https://drive.google.com/file/d/150xv8LZvrZ1sIt9TDT7oeSCmU-Geg5DQ/view?usp=sharing
7 See Uplands public information mailer, under BUYER BEWARE! p 2 https://bit.ly/uplands-m
8 An example is Docket No. 6680-CE-182, Application of Wisconsin Power and Light Company for a Certificate of Authority for Acquisition, Construction, Installation, and Operation of Six Solar Electric Generation Facilities in Wisconsin) https://apps.psc.wi.gov/ERF/ERFsearch/content/searchResult.aspx?UTIL=6680&CASE=CE&SEQ=182&START=none&END=none&TYPE=none&SERVICE=none&KEY=none&NON=N
11 Certificate of Public Convenience affording Public Utilities the ability to use eminent domain
12 An example is Docket No. 6680-CE-182, Application of Wisconsin Power and Light Company for a Certificate of Authority for Acquisition, Construction, Installation, and Operation of Six Solar Electric Generation Facilities in Wisconsin)
14 By delivered, I am referring to what ends up in the customers outlet (the energy we actually use).
16 Again, avoiding the transmission grid market.
17 Leading to a much higher percentage of the generated electricity being used in comparison to utility-scale power plants.
18 Uplands Mailer, p 9, Table 3, https://bit.ly/uplands-m Chris Clack- Why Solar for All Costs Less: A Roadmap for the Lowest Cost Grid (exemplifies how, even with a small percentage of distributed energy, economics and carbon reductions increase) https://www.vibrantcleanenergy.com/wp-content/uploads/2020/12/WhyDERs_ES_Final.pdf