Wisconsin brings energy pricing transparency into strategic assessment
Wisconsin Public Service Commission (PSC) included more updated data and insight into electricity costs into the final version of its 10th biennial strategic energy assessment (SEA), issued on Wednesday.
The latest changes responded to stakeholder comments challenging the PSC's lack of transparency on the state's high electricity prices. Stakeholders said "a strategy for addressing Wisconsin's electricity price problem should be discernible."
Many of those issues were addressed in the new report, Tom Content, executive director of Wisconsin's Citizen's Utility Board (CUB) told Utility Dive. CUB argued, in part, that because of Wisconsin's higher electricity costs, relative to the rest of the Midwest, consumers should see more detail regarding utilities' "future resource plans" and how that may affect rates.
Coal remains "one of the barriers" in Wisconsin for a progressive energy renewables portfolio, Tyler Huebner, executive director for Renew Wisconsin, tells Utility Dive. The state's 2014 SEA noted "Wisconsin's current fleet of coal plants are well positioned to produce favorable energy sales into the MISO market which will benefit Wisconsin's ratepayers."
However, now all of Wisconsin's coal is imported from Wyoming or through the Great Lakes, since the retirement of its plants in recent years which leaves the state with high import costs. Huebner says the shift towards renewables is becoming the obvious rate-saving move for utilities.
The report lays out the current state of Wisconsin's electric energy capacity and supply, as well as "expected conditions" through 2024. Coal makes up 45% of the state's electricity generation in 2018, down from 51.4% in 2016 and natural gas makes up 37% of the state’s electricity generation, up from 23.8% in 2016. The state's early narrative regarding its electricity prices, according to the CUB, was that "high electricity rates relative to nearby states were driven significantly by 'earlier' investment in new capacity resources," including the construction of generation plants throughout the 1990s, from which utilities needed to seek cost recovery.
Although the state's renewables generation is not high in comparison to other states, a 10% goal was set in 2006 and generation remains just over that. Clean energy jobs make up only 2.55% of the workforce, according to an analysis done by Clean Jobs Midwest, ranking only below Michigan and Indiana, at 2.8% and 2.7%, respectively.
While Wisconsin hasn't changed its renewables mandate since 2006, utilities seem to be motivated to buy them on their own because of the cost savings, says Huebner.
"It's a moment that many renewable energy advocates have been waiting for," said Huebner. "When [utilities] need energy and power capacity, wind is the answer on energy and solar is the answer on capacity that matches up with summer peak loads as the most cost-effective answer."
The state plans to retire around 2,100 MW of existing Wisconsin-based electric generation" by 2024, likely natural gas and coal plants, consistent with other retirements this year, Martin Day, Administrator of the Division of Energy Regulation, tells Utility Dive and add approximately 796 MW of new energy, likely renewables.
Federal tax cuts as well as good energy efficiency programming have plateaued Wisconsin's electricity rates, Huebner notes. However, the rates are still higher overall than they should be, according to CUB's Content. However, he notes the PSC report "shows strong reliability" and an interest in modernizing the grid, which he hopes will benefit customers in the long run.
Correction: An earlier version of this story incorrectly identified the plants the SEA projected to retire by 2024. The SEA expects natural gas and coal plants will start retire as sources of electric generation for Wisconsin by 2024.
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