Wisconsin Utilities and Environmental Groups Unite behind Solar, but Regulators Question Value

Regulators and consumer advocates are questioning the value of Wisconsin’s first large-scale solar project, while environmental groups are lining up in support of the investor-owned utilities as they embrace renewable energy.

Madison Gas & Electric and Wisconsin Public Service Corp. have jointly proposed to buy 300 megawatts’ worth of solar panels at two projects under development along Lake Michigan and in rural southwestern Wisconsin.

Both utilities say they need to replace aging fossil fuel generators and that the $405 million investment will cost customers $181 million less than other alternatives for meeting demand.

Environmental groups — often at odds with the state’s utilities — agree. “I’m convinced this is the best way forward for MGE and WPS,” said Michael Vickerman, policy director for Renew Wisconsin. “We’re seeing this happen all over the country. If capacity is required, large-scale solar is the most economic option.”

But Public Service Commission staff have questioned the economics, prompting concerns from consumer advocates.

The Citizens Utility Board, which represents residential and small-business customers, says staff raised valid concerns about the benefits and whether future policy decisions could leave customers having to fund additional investments.

“All of the decisions are being made now about what costs customers are going to shoulder,” said CUB executive director Tom Content. “Our risk is all up front, but our payoff could be questionable down the road.”

It will be up to the three-member PSC to determine whether purchasing the solar farms will impair the utilities’ efficiency, exceed their future needs or increase the cost of service without also increasing the value or quality of service. The commission is separately considering private developers’ plans to build the two solar farms, which have generated some opposition from neighbors.