Last fall, regulators allowed Wisconsin to join Arizona as the only states in the nation that force owners of solar-generating systems to pay an extra fee to their utility simply for investing in and producing their own energy.
We Energies had claimed in its rate case before the state Public Service Commission (PSC) that its customers with solar panels actually cost the utility money, which they need to recoup from these customers. Two of the three-member commission agreed. The tariff is imposed on residential solar owners in We Energies’ territory, although those who’d installed solar prior to the rate case are exempted for 10 years.
But that decision may not stand.
Solar advocates filed suit in state court this spring alleging that the PSC didn’t have solid data to justify We Energies’ new fees.
In fact, Renew Wisconsin and the trade group The Alliance for Solar Choice (TASC) charge that the data provided by We Energies to the PSC showed just the opposite: Solar customers actually save the utility money by not overburdening the grid during peak hours.
Tyler Huebner, executive director of Renew Wisconsin, said that We Energies has taken on an unusually hostile stance toward solar because the utility has overinvested in coal plants and wants to discourage customers from going solar now that it’s become an affordable option for many homeowners. (For the record, when We Energies proposed building a massive coal-fired power plant in Oak Creek and putting the ratepayers on the hook for decades to come, the Shepherd came out strongly against building “dinosaur” power plants that will eventually hurt our business climate due to higher rates.)
“We Energies is certainly on the spectrum of trying to stop customer-owned solar,” Huebner said. “There are other utilities that are not doing that. There are other utilities that are embracing solar and seeing that as another element of how electricity is going to work in the 21st century.”
But We Energies spokesman Brian Manthey said the PSC made the right call, saying the solar tariff is “a fundamental matter of fairness.”
“We firmly believe the commission decision in this case is correct and supported by sound principles,” Manthey wrote in an email to the Shepherd.
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Residential Customers Penalized
The suit attempts to force the PSC to reconsider its decision to allow We Energies to charge its residential solar customers—but not its customers who own large solar-generating systems—an extra fee.
The groups claim that the PSC’s decision was unfair and should be revisited with better data. In court documents, they knock down We Energies’ claims that it would need to build new combustion turbine plants to provide backup generation for the times when solar customers would need to be on the grid. We Energies has surplus generation capacity, the groups say, and wouldn’t need to build any new plants and incur extra costs to accommodate its solar customers.
The groups also say that the new solar fees are based on the size of a solar system, not the amount of solar- or We Energies-generated power used. That’s arbitrary, the groups say. They also state that exempting owners of large solar-generating systems—such as the Metropolitan Milwaukee Sewerage District (MMSD) and corporations with a host of solar panels—highlights the new fee’s unfairness. The groups also allege that We Energies’ customers with solar panels already pay toward the cost of maintaining the electricity grid.
This is the third time that Renew Wisconsin has gone to court to ask for a judicial review of an anti-renewable energy PSC decision based on incomplete or incorrect data. Its two previous challenges resulted in the judges overturning the PSC’s pro-utility decisions. They were sent back to the commission for more robust fact-finding.
“We’re hopeful that the court system will again tell the Public Service Commission to do their job, follow the law and make sure that there’s substantial evidence in the record before making a decision,” said TASC spokeswoman Amy Heart. “Especially one that is so dramatic and such a shift in ratemaking that has only happened in one other state in the country.”
When asked to provide the data We Energies used to show that solar customers force the utility to take on extra costs, Manthey merely directed the Shepherd to the PSC’s online docket for the case.
Walker Appointees in Charge
In addition to lacking data, the groups say that PSC Commissioner Ellen Nowak, a former voucher school lobbyist, was predisposed toward We Energies before taking on the rate case. Nowak told utility industry groups in 2014 she’d support rate hikes for solar customers before looking at the evidence in this case. On one occasion, Nowak made her comments with We Energies CEO Gale Klappa at her side, saying “we need” to change the rate structure, the groups allege in the suit.
When TASC asked Nowak to recuse herself for being biased toward the utility she is supposed to regulate impartially, she refused.
Nowak voted with then-Chief Commissioner Phil Montgomery, a former Republican legislator, to support We Energies’ solar tariff. The lone dissenter, Eric Callisto, was the final Jim Doyle appointee to the PSC. Callisto was replaced this spring with former Republican legislator and Department of Administration Secretary Mike Huebsch. In an internal shuffle, Nowak became chief commissioner while Montgomery became a regular commissioner.
Huebsch is currently caught up in the scandal surrounding the Wisconsin Economic Development Corporation (WEDC), Gov. Scott Walker’s troubled jobs agency. Records show that Huebsch pushed for a risky $500,000 taxpayer-funded loan to a high-dollar Walker donor after the donor’s company couldn’t find funding elsewhere. The company has since defaulted on the loan and taxpayers are left holding the bag.
With Huebsch’s nomination, Walker’s appointees have now completely captured the PSC.
Despite We Energies’ attempts to make going solar more expensive, the city of Milwaukee is moving ahead with its Milwaukee Shines solar group buy program. The program, in partnership with the Midwest Renewable Energy Association (MREA) and the Riverwest Cooperative Alliance, launched an East Side group buy last week.
MREA’s Peter Murphy said We Energies’ expensive coal-produced energy has spurred participation in Milwaukee Shines.
“Our experiences over the last two years helping people in Milwaukee go solar have proved to us that people don’t want to be captive to rising electric rates from out-of-state coal,” Murphy said. “And they are upset that the regulators are approving these policies that both reduce customer choice and increase electricity costs.”
