Wisconsin’s strategic energy assessment needs to be more dynamic – commenters

The state of Wisconsin’s strategic energy assessment (SEA), a biennial assessment of the state’s past and future electricity needs and sources of supply, is outmoded and needs to be revised, according to several parties that submitted comments on the draft SEA to the Public Service Commission of Wisconsin (PSC) (Docket No. 5-ES-106).

An SEA is issued every two years and looks at the state’s energy picture over a seven-year horizon. The draft SEA covering the period of Jan. 1, 2012, through Dec. 1, 2018, was made available publicly on June 14; the deadline for comments was Sept. 14.

“The draft SEA … brings to light issues that may need to be addressed to ensure the availability, reliability, and sustainability of Wisconsin’s electric energy supply,” the PSC said in its letter accompanying the draft.

The problem, according to several commenters, is that the document isn’t nimble enough for today’s electric industry environment.

“Given the dynamic nature of energy policy and energy markets in this country, we believe the state’s primary planning tool should be equally as dynamic,” WPPI Energy said in comments submitted by Dan Ebert, its SVP of external affairs.

“Our planning environment has become increasingly complex since Wisconsin’s integration with the Midwest [ISO (MISO)]. The reality is that we often look to MISO, FERC and Congress for economic, policy and regulatory decisions and developments that impact our ability to meet this important planning mission,” WPPI said.

As a result, WPPI said, “Wisconsin entities … are often faced with decisions that we do not control and in which we may disagree, but must factor into our planning.” The state’s planning efforts must be updated to do the same, the company said.

“Ultimately we believe that our planning should be comprehensive and flexible. It should consider the regulatory environment in Wisconsin, as well as regulatory actions taken in Washington, D.C., and market decisions made at MISO and in other RTOs,” WPPI said. “And it should recognize the flexibility Wisconsin utilities must have to respond to fast changing market conditions or changes in policy to meet its obligations to its customers.”

American Transmission Company (ATC), which primarily commented on technical aspects of the draft SEA, also acknowledged the need to update the report.

“The fast pace and sometimes unpredictable course of change in the energy and electric industries make it very challenging to prepare a report for the Legislature and the public,” ATC said in its comments.

The Citizens’ Utility Board and Clean Wisconsin (CUB/CW) agreed, but were also critical of other facets the report.

“The SEA has no clear audience or purpose, and those factors have minimized the document’s usefulness,” the two groups wrote in a joint letter to the Wisconsin Public Service Commission (PSC). “The content and size of the SEA has also morphed (and generally shrunk) over time, reflecting this lack of focus.”

CUB/CW also said the effects a changing regulatory environment is having on the industry must be taken into account.

“Since the SEA has been in place, another new development has been the need to install costly pollution control equipment at a number of Wisconsin generating stations in order to comply with U.S. Environmental Protection Agency (EPA) mandates,” the groups said.

The groups urged the PSC to take a more active role in defining the state’s energy future.

“The practice in Wisconsin has been to react to utility applications as they are filed, and to confine the analysis of an application to the parameters of the utility’s request,” CUB/CW said. “Waiting until a utility chooses to file an application, as opposed to occasionally engaging in a more proactive forward-looking process, may not result in the most cost-effective solution to a given problem.

The Pennsylvania-based Retail Energy Supply Association (RESA) also recommended updating the SEA “to address facets of the changing market structure, engage in further examination of whether electric industry restructuring and the introduction of competition can help the State of Wisconsin meet its future energy needs.”

“Wisconsin ended an examination regarding electric industry restructuring in early 2000,” RESA noted. “[H]owever there has been tremendous growth and success with competitive electricity markets across the country and as such now is the time to reconsider that determination from over a decade ago.”

A spokesperson for the PSC said that matter may be outside the scope of the SEA.

“The SEA is an energy planning document; retail choice is a policy matter,” the spokesperson told TransmissionHub Sept. 17, noting that efforts to bring retail choice to the state would have to start in the legislature.

Individuals also weighed in. One citizen urged the PSC to consider more distributed generation and less transmission in its planning.

“Transmission lines are said to be needed for reliability when in fact they may only increase system vulnerability,” Ernest Martinson of Hayward, Wis., said. “Transmission lines … can precipitate system shutdowns in the face of acts of terrorists or of God.”

Martinson also called for a speedy transition to an open energy market.

The commissioners will receive a draft of the final SEA next month, and will incorporate any changes they deem appropriate based on the public comments received. A final SEA will be issued in November or December, the spokesperson said.