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©2015 E&E Publishing, LLC
Republished with permission
By Jeffrey Tomich
MADISON — Speakers at an all-day conference on energy policy in Wisconsin evoked two images of the state’s renewables sector. And neither is encouraging for clean energy advocates.
The first was “Rudy,” the inspiring 1993 film about a student’s quest to make the University of Notre Dame’s storied football program as a walk-on. The other reference was Sisyphus, the king in Greek mythology who was sentenced to push a large boulder uphill for eternity.
Whatever the metaphor, renewable energy advocates in Wisconsin are being forced to embrace the role of underdog with Republican Scott Walker staying put as governor, the state legislature awash in red and Walker appointees holding a majority on the three-member Public Service Commission.
Renew Wisconsin, the host of Friday’s meeting, sees the exponential growth in rooftop solar happening elsewhere across the nation, from neighboring Minnesota to red states such as Georgia. But the same is “just not happening in Wisconsin, and the major reason is policy,” said Tyler Huebner, the group’s executive director.
Wind energy development has largely been on hold in Wisconsin for a few years, Huebner said. And whatever momentum was building for adoption of more distributed solar generation was halted two months ago when the Public Service Commission approved a series of controversial proposals by We Energies, the state’s largest electric utility.
In a case that drew national attention, the PSC ultimately approved a reduction in net metering rates (the rates at which customers are credited for excess energy put on the grid) for We Energies customers, imposed a demand charge for recovery of fixed costs from customer generators and raised fixed charges for all customers (EnergyWire, Nov. 17). The commission also slightly reduced variable energy rates. But in sum, solar advocates say, the commission’s order effectively doubles the payback period on a residential solar energy system.
A poll last summer commissioned by an environmental advocacy group reflected strong support for energy efficiency and renewables. But without the ability to push through broad changes like an expansion of the state’s 10 percent renewable energy standard, furthering clean energy development must rely on more nuanced, targeted strategies, speakers said.
Those strategies include getting more large Wisconsin businesses on board and involved in policy discussions. Frequently cited was Milwaukee-based Johnson Controls Inc., a global supplier to the building and automotive industries with $43 billion in sales last year. The company intervened in the We Energies rate case to oppose the utility’s proposal to increase fixed customer charges, arguing that the changes discouraged energy efficiency.
Brad Klein, an attorney for the Chicago-based Environmental Law and Policy Center, emphasized the need for clean energy advocates to work with investor-owned utilities to redesign an outdated business model focused on a centralized power grid. That business model too often pits utility shareholder interests with consumer interests and serves as a barrier to reduce energy use and deploy new technology.
Klein cited the Utility 2.0 reforms pursued by the state of New York. And there’s a similar but less developed effort underway in Minnesota, where Xcel Energy Inc., a participant, just proposed significant new additions of wind and solar energy over the next decade and a half.
“I think the key is figuring out some of these business model challenges,” Klein said.
Battling the ‘steamroller’
While some utilities are trying hard to reinvent themselves, “others are doubling down on the status quo” and flexing their political muscle by challenging changes in statehouses and utility commissions, he said.
Renewable advocates say We Energies and two other Wisconsin utilities that pushed through large fixed-charge increases last month didn’t provide sufficient proof to support the commission orders. A decision is coming soon on whether to seek judicial review, and if so on what grounds.
State Rep. Chris Taylor, who drafted a measure last year to expressly authorize third-party solar financing in Wisconsin, said the commission’s decision “made our state one of if not the most hostile to solar.”
Taylor, a Democrat who said she belongs to the American Legislative Exchange Council and attended ALEC’s annual meeting last spring just to stay up to date on what her political opponents are doing, implored environmental groups, businesses and others to work more closely. Otherwise, they cannot overcome a galvanized conservative movement.
“We need to get organized,” she said. “We cannot come to the battle with a fly swatter when they have a steamroller.”
Matt Neumann, an owner of Sunvest Solar, which has installed 10 megawatts of solar and does business in five states, said there’s no disputing that utilities see solar developers like his company as a competitive threat and the two industries will continue to butt heads.
“We’re diametrically opposed to each other, and there’s really no other way to say it,” he said.
Politically, though, the battle isn’t one defined by party lines. There’s strong support for solar expansion among some conservatives, he said. For instance, Georgia tea party activist Debbie Dooley as well as a solar advocacy group led by former Rep. Barry Goldwater Jr. both opposed the We Energies proposal.
Neumann, the son of former Republican Rep. Mark Neumann, said distributed energy offers benefits that mesh with widely held conservative principles such as consumer choice and free markets, property rights, national security, and job growth (ClimateWire, Aug. 14).
“Those are just fun things to get Republicans thinking,” he said.
There are also subjects not to bring up.
“Do not talk about climate change, please,” Neumann said. “It’s a lightning rod topic, it’s not going to get you anywhere.”
Neumann said he’s met with Republican legislators and thinks that a measure to allow third-party financing for solar projects would be possible this session if framed as a consumer choice bill.
“A narrowly defined solar bill for financing I think has legs and can work,” he said. “Republicans would have to violate their own principles to deny it.”
Longer term, Wisconsin will have little choice but to transition to more renewable resources, especially if U.S. EPA’s Clean Power Plan is finalized, said Gary Radloff, director of Midwest energy policy analysis at the Wisconsin Energy Institute.
“The genie is out of the bottle,” Radloff said. “Our energy system is going to change, and you’re going to like it. But I have no idea how fast it’s going to happen.”
While embracing natural-gas-fired generation may help the state comply with greenhouse regulations and meet EPA’s 2030 target, the fuel would require significant upgrades in infrastructure, and history would suggest that prices for the commodity won’t stay cheap forever.
“We might have a couple of decades of reasonably priced natural gas,” Radloff said.
Ultimately, the most cost-effective strategy is to rely much more heavily on renewable energy and efficiency — a strategy that would require the scale of development underway in Minnesota.
“I don’t want to candy-coat this. It will cost us money,” Radloff said. “But it is achievable if you have the political will.”