The PSC’s Zero-Carbon Roadmap: First Steps on a Path to a Clean Grid

The PSC’s Zero-Carbon Roadmap: First Steps on a Path to a Clean Grid

In 2019, Governor Evers issued Executive Order #38 to establish a goal for carbon-free electricity in Wisconsin by 2050. As the state regulator of utilities, the Public Service Commission (PSC) is tasked with regulating the number one sector source for greenhouse gas emissions in Wisconsin[1]. As a result, PSC decisions play a key role in determining whether Wisconsin will be able to achieve a zero-carbon grid by 2050.

The PSC reviews utility proposals for construction projects, rate increases, and new utility programs for their customers. However, the PSC reviews these proposals separately from one another, and historically without the integration of other utility plans, carbon reduction goals, and cross-sector emission-reduction strategies. The good news is that the PSC has begun to explore how to incorporate these factors within its decision-making processes going forward.

In keeping with a recent trend of investigating policy issues (such as Electric Vehicles and Parallel Generation), this past spring the PSC opened a docket (5-EI-158)  to pursue a “Roadmap to Zero Carbon.” As described in the Notice of Investigation, the PSC intends to evaluate government and utility goals to reduce carbon emissions to zero by 2050, recommendations from recent Wisconsin reports on clean energy and climate change, and the development of partnerships to achieve carbon-free electricity by 2050.

The Zero Carbon Roadmap docket garnered much interest from active PSC intervenors (such as RENEW), with participation from environmental, health, and business advocates as well. Members of the general public also participated with input and suggestions. PSC staff issued a memo for public comment on scoping of priorities. After gathering public input, PSC staff issued a follow-up memo to the Commissioners in August that summarized stakeholder input and provided the Commissioners with options on the next steps. The Commissioners then discussed the memo and issued an order in September to take some initial actions.

In short, the PSC decided to leverage ongoing planning processes and to investigate a potentially new approach to utility ratemaking. Below is a summary of these initial steps:

  • The PSC will gather more robust carbon-reduction planning information from utilities during the current biennial Strategic Energy Assessment (SEA). Utilities will soon respond to the PSC staff’s initial data request, and PSC staff will issue a draft report by next spring for public comment;
  • Additionally, the PSC will seek public input on ways in which the state’s Focus on Energy program (Focus) can better incorporate beneficial electrification, programs for low-income customers, demand response, and other utility voluntary programs into its program design over the next four years. This is called the Quadrennial Planning Process, and a PSC staff recently issued a memo for comment on scope; and
  • Finally, the PSC will organize a workshop on Performance-based Regulation (PBR). This workshop will gather information and perspectives on how rethinking utility goals and investment incentives can lead to a more equitable clean-energy future. The PSC will also consider customer affordability issues in relation to the transition to a zero-carbon grid.

Even with these planning processes already underway, the book is not closed on the Roadmap to Zero Carbon docket. RENEW recently reached out to Joe Fontaine, PSC Policy Advisor, to get a better sense of next steps for the investigation docket itself. Fontaine said:

“Commission staff is excited to kick off the Roadmap by addressing four of the highest priorities identified by commenters and approved by the Commission. Each of these four areas — more transparent resource planning, development of performance-based regulation concepts, and further analysis of affordability and energy efficiency issues — can help us develop a strong general foundation to address a wider range of issues related to the clean energy transition, in this investigation as well as in other Commission dockets. Future decisions in the Roadmap will be well-informed by the analysis and stakeholder input we’re receiving at each step in the investigation. Potential next steps will be determined as we make progress on these initial priorities over the next few months.”

The PSC’s Roadmap to Zero Carbon activities is running in parallel with the Office of Sustainability and Clean Energy’s (OSCE) Clean Energy Plan drafting process. Beyond the electricity sector, the Clean Energy Plan will assess, and make recommendations on, strategies cutting across all economic sectors statewide. The OSCE recently gathered public input during several public listening sessions, focusing on 1) economic and environmental justice, 2) infrastructure and industry, 3) transit and transportation, and 4) clean energy and energy efficiency. The OSCE continues to gather written comments through its website.

RENEW is also proactively partnering with Clean Wisconsin and GridLab to conduct a zero-carbon grid study for the PSC’s consideration. While the scope is still being finalized, the study will use modeling designed to answer important policy questions, such as:

  • What is the right mix of renewable resources in-state and out-of-state?
  • What is a good balance between utility-scale and distributed solar resources?
  • How much transmission is needed in a zero-carbon future?
  • What will be the health, jobs, and economic impacts as we make this clean grid transition?

Stay tuned on these zero-carbon planning activities and upcoming study developments. RENEW plans to organize presentations and panel discussions on these topics at our Renewable Energy Summit on January 27, 2022.


[1] See the Department of Natural Resources’ Wisconsin Greenhouse Gas Emissions Inventory Report of August 2020. Figure 1, on page 3, presents emissions by sector. Electricity generation is the highest emitting sector and represents 33 percent of all Wisconsin emissions.

Smaller Solar Farms in Wisconsin – Why More Are Needed

Smaller Solar Farms in Wisconsin – Why More Are Needed

For decades, utility investments in power plants and transmission lines have been predicated on the concept of economies of scale. The theory behind it is beguilingly simple: the larger the installation sought by an electric utility, the lower the unit cost of the investment, which utility planners and regulators regard as a measure of economic efficiency. When loads are growing, the “bigger is better” paradigm is often an economically rational fit for electric utilities seeking to recover large-scale capital investments in fossil generation over the broadest possible cohort of current and future customers.

But solar power, the default resource option for electric providers today, is a somewhat different animal due to its scalability. Yes, economies of scale can certainly reduce the unit price of solar generating capacity, but other on-the-ground factors can influence the economics of this resource. These factors include but are not limited to the cost of acquiring site control of the host properties and obtaining all the necessary approvals to construct the project. Interconnection costs can be high as well, especially for larger projects requiring additional land and approvals to supply power to the grid.

These thoughts came to mind after visiting two smaller solar farms that started producing power this year. The first project, called Strobus Solar, was developed by OneEnergy Renewables and serves Jackson Electric Cooperative. The second installation, O’Brien Solar Fields, was one of the stops in this September’s Ride with RENEW bicycle tour. Developed by EDF Renewables and owned by Madison Gas and Electric (MGE), this 20 MW solar farm in Fitchburg supplies electricity to seven MGE customers under long-term contracts.

At a Glance
Solar For the Distribution Grid – 2021
Project name Strobus Solar O’Brien Solar
County of location Jackson Dane
Capacity (in MWac) 1.5 20
Project developer OneEnergy Renewables EDF Renewables
Project owner Greenbacker Capital Madison Gas + Electric
Utility territory Jackson Electric Madison Gas + Electric
General contractor Arch Electric Boldt Construction
Landowner Northern Family Farms O’Brien Brothers Farm

 

Governor Evers and the Project Developer, Eric Udelhofen, from OneEnergy Renewables at the Ribbon Cutting Ceremony for the Strobus Solar project.

Strobus – A Mastodon Solar project

Occupying a mere 12 acres, Strobus Solar is located about six miles north of Black River Falls and is tucked into a compact parcel framed by evergreen trees and U.S. Highway 12.  On a cloudy September day, more than 50 people attended a ribbon-cutting ceremony for the Strobus project, one of eight solar farms in southeast Minnesota and west-central Wisconsin that make up OneEnergy’s Mastodon Solar portfolio. With a combined 17 megawatts (MW) of AC-rated capacity, all eight Mastodon solar farms are located in the territory served by rural electric cooperatives. 

As noted on OneEnergy’s website, “the electricity generated by each project will be purchased by the local participating electric cooperative, resulting in savings on energy supply and increased resiliency. These savings will be passed onto the cooperative’s members. The available Renewable Energy Credits will then be sold separately to visionary buyers committed to ensuring their renewable energy procurement dollars are devoted to new projects that serve local communities.”

Of the four Mastodon projects located in Wisconsin, Strobus is the second to be energized this year, following Blue Prairie, a 2.5 MW installation southwest of Black River Falls. The other two, Stromland and Shamrock, should be operating before the end of this year. Plymouth-based Arch Electric is the general contractor for all four Wisconsin projects.

Governor Evers spoke at the ribbon-cutting ceremony, along with representatives of Jackson Electric Cooperative, Arch Electric, and Northern Family Farms, the participating landowner. Based in nearby Merillan, Northern is Wisconsin’s largest Christmas tree grower, operating on more than 7,000 acres. After the prepared remarks, OneEnergy and Arch opened the gates to let Governor Evers and other guests circulate through the project and ask questions.

On one corner of the Strobus parcel is the substation that feeds the solar-generated electricity directly into the wires overhead. Though the equipment onsite is brand-new, low-growing grassy vegetation has already been established, covering the entire project footprint. After three years, the mix of deep-rooted, primarily native plants will provide a healthy habitat for birds, insects, and other species. At nearby Blue Prairie, sheep are already grazing around and under the 7,000 panels installed there. 

Strobus is expected to generate about 3,000 megawatt-hours of electricity a year. But the Renewable Energy Credits associated with that output will not flow to Jackson Electric. They will instead be sold to Native, a Public Benefits Corporation, through its New Renewables Portfolio. 

According to Native’s website, the purpose of the Portfolio “is to enable Renewable Energy Credit (REC) buyers to play a causal role in actualizing new renewable energy projects. Native has committed to a 10-year renewables purchase agreement with Strobus, LLC on behalf of Portfolio investors. Without this type of long-term REC purchasing agreement, this project would not be economically viable.”

O’Brien Solar Fields in the city of Fitchburg, Wisconsin. 

O’Brien Solar – Clean Energy Produced Offsite for Larger Customers

Occupying 130 acres along the edge of urban Fitchburg, O’Brien Solar Fields is as large as a distributed solar project gets. However, while every kilowatt-hour produced at O’Brien flows directly into Madison Gas and Electric’s distribution grid, only seven customers see the impact of this project on their utility bills. Those customers are the State of Wisconsin, University of Wisconsin-Madison, City of Fitchburg, Promega, Placon, Tribe 9 Foods, and Willy St. Co-op. 

Energized this summer, O’Brien Solar is the newest Renewable Energy Rider (RER) project serving MGE customers. Several years ago, MGE received approval from the Public Service Commission (PSC) to build solar farms to serve individual customers, including those with multiple facilities, through its RER program. Unique to MGE, this service allows customers to be served by one larger solar farm instead of building numerous solar systems to supply each of their facilities. 

A voluntary program, MGE’s RER program does not affect base electric rates. Participating customers fully absorb the cost of MGE’s investment in the solar arrays, and these costs are spread over 30 years. The electricity generated at O’Brien offsets grid power that would otherwise flow to these customers at specified prices throughout the contract term. Should standard electric rates rise faster than the agreed-upon pricing for O’Brien’s electricity, the savings will flow directly to the participating customers. 

This unique model combines elements of both behind-the-meter generation and community solar power. But in order to entice customers to access brand-new yet low-cost sources of power, the project owner must design and develop projects that are competitive with the utility’s own avoided cost of power. 

The question arises, what did MGE do to keep O’Brien’s development costs in line with its investments in larger solar projects and make it an affordable option for customers?

First, the project occupies only one parcel of land, the former Stoner Prairie Dairy owned and operated by the O’Brien brothers over several generations. Though the parcel is adjacent to a rapidly growing neighborhood, the project’s configuration allows the O’Brien family to maintain its most profitable farming operations as well as live in their long-time residence. Negotiating with only one landowner gives a developer more room in tailoring the project to avoid potentially expensive workarounds. 

Second, from an electrical perspective, the project is divided into three zones, each with a separate interconnection to MGE’s feeder lines. By spreading out the project’s output in this fashion, MGE could forgo the more significant expense of running a large tie-in line to the closest substation.

Third, much like a 30-year residential mortgage, the RER contract is a powerful tool for breaking down a significant capital outlay into a manageable expense for the customer. Just as utilities rely on extended depreciation schedules to help them digest the costs of building central station power plants, the RER service provides a similar benefit to participating customers.

In the end, the all-in cost of O’Brien Solar Fields amounted to $29.5 million, which, on a unit basis, comes to $1,475 per kilowatt (kW). To put that number in perspective, the unit price of six larger solar farms totaling 414 MW that Alliant Energy proposes to acquire is $1,449 per kW. In fact, O’Brien’s unit cost is within 10% of the estimated cost of acquiring a 20 MW share of a project ten times as large. 

Moreover, it took only three years for EDF Renewables, O’Brien’s original developer, and MGE to advance this power plant from the concept stage to fruition, a relatively speedy turnaround compared with larger solar installations. 

Conclusion: The Policy Case for Smaller Solar Farms

Indeed, small solar farms can deliver affordable electricity at a reasonable price by avoiding the increased complexities and additional permitting hurdles associated with larger solar farms that tie into the transmission system. Moreover, while larger solar farms make a great deal of sense in areas rich in transmission infrastructure, relying solely on those locations would exclude much of Wisconsin from being able to host solar power. 

There are many parcels of land throughout Wisconsin that have the requisite attributes for hosting projects on the scale of Strobus and O’Brien. In addition, projects of that size are ideal vehicles for community solar offerings, designed to deliver zero-carbon electricity to subscribing customers who cannot access solar power at their residence or business. 

Over time, with increases in system power costs looking very likely, the state should explore and adopt policies to promote smaller solar farms within its boundaries. As exemplified by the Strobus and O’Brien projects, development on that scale can yield faster results at comparable costs while potentially providing a reliable revenue stream to the many thousands of landowners who don’t live near high-capacity transmission lines and substations.

Wisconsin is in the beginning stages of an energy revolution. With a more forward-looking policy framework, Wisconsin could emerge as a national leader in solar power. Embracing distribution-level solar solutions now will help more Wisconsinites participate in the benefits of these projects and give every city, town, and village a solar project to call their own. Wisconsin’s population is distributed throughout the state–our renewable energy portfolio should be as well. 

Clean Energy Takes Front Row Seat at Renewable Energy Day at the Capitol

Clean Energy Takes Front Row Seat at Renewable Energy Day at the Capitol

On October 13, RENEW Wisconsin and Wisconsin Conservative Energy Forum (WCEF) hosted their first-ever Renewable Energy Day at the Capitol in Madison. The event included issue briefings by industry experts on a variety of legislation that has been introduced this year related to the solar and electric vehicle industries. Attendees then went to the State Capitol to speak with their legislators to gain support for these important issues.

During a welcome reception, the evening before the Day at the Capitol,  RENEW and WCEF held a panel discussion “Energy in Transition: Policy and Politics.”

From right to left were moderator, Scott Coenen (WCEF), Dan Ebert (former PSC Chairman), Senator Rob Cowles, Larry Ward (Conservative Energy Network), and Jim Boullion (RENEW Wisconsin).

The panel discussed the current uncertainty in world energy markets and the impact that energy shortages and spiking prices will have on the world. There was consensus from the conversation that panelists believe renewables can help stabilize much of this energy uncertainty, but that the industry needs to be realistic about its role in a world where supply is not meeting demand. Businesses, households, and communities in Wisconsin should be empowered to invest in their own energy generation. 

Before attendees went to the Capitol to meet with their legislators, there was an issue briefing with a panel of industry experts moderated by Jim Boullion, Director of Government Affairs for RENEW Wisconsin. The panelists explained in detail what legislative proposals were currently before the legislature, how they will impact renewable energy in Wisconsin, and what arguments are being made on both sides of the issue. 

Issue briefing panelists, Left to right: Jason Mugnaini (Chief of Staff, State Senator Rob Cowles), James Fenley (SJL Government Affairs & Communications), Peter Lund (Financial Structuring Associate, Nautilus Solar Energy), and Amy Heart (Senior Director, Public Policy, Sunrun).

The first panel discussed two solar-related issues: 

  • Expanded Development of Community Solar – (SB 490 / AB 527 – Sen. Stroebel and Rep. Ramthun)  This bill would authorize the development of non-utility owned community solar projects and provide access to the economic and environmental benefits of solar for those who can’t afford the full cost of a system, live in multi-family housing, or own property that is not suitable for solar. 
  • 3rd Party Financing/Leasing – (LRB 1550/1 Sen. Cowles and Rep. Cabral-Guevara) This legislation would clarify that 3rd party financing/leasing of renewable energy equipment is legal in Wisconsin, providing affordable financing options for people, businesses, municipalities, or not-for-profit entities who don’t have the resources to pay for solar on their own property.
Learn more about how to support these two bills at www.wisolarcoaliton.com.

 

The second panel, moderated by RENEW’s Jeremy Orr, Emerging Technology Program Manager, discussed electric vehicle issues such as Wisconsin’s recent Direct Electric Vehicle Sales legislation, SB 462 / AB 439  (Sen. Kooyenga and Rep. Neylon)Albert Gore, Policy and Business Development at Tesla, discussed how allowing manufacturers to sell electric vehicles directly to consumers creates greater access to the electric vehicle market, resulting in growth in the traditional dealership model. Read Jeremy Orr’s previous testimony on this issue here.

Likewise, Justin Ackley, Public Policy Manager at ChargePoint, spoke to the business clarity and consumer transparency that AB 588 / SB 573  (Sen. Cowles and Rep. VanderMeer) would provide, as it would allow non-utility-owned charging stations to charge by the kWh. Similar to a gas pump, where the price per gallon is displayed, kWh charging tells electric owners how much energy they’re paying for, regardless of how long it takes to charge their vehicle. The panel pointed out that while the main goal of this legislation is good, another section of it would create problems by prohibiting charging a fee if any of the electricity going through the EV charger comes from a non-utility source such as a solar+storage system.

Emerging technology allows EV chargers to be installed in areas, especially rural areas, that have inadequate grid infrastructure and can help limit costly spikes in energy “demand charges” for charging station owners. EnTech, a division of Faith Technologies based in Menasha, Wisconsin brought one of their portable solar+storage units to Capitol Square to demonstrate how the technology works and how flexible it can be. A similar system was set up at  Bergstrom Ford in Neenah to help reduce the energy bills at their dealership. John Bergstrom, the owner of the dealership, told the story of why he worked with Faith Technologies to install the system in this podcast. 

 

The panel closed the session by discussing two other bills recently introduced by Sen. Rob Cowles:

  • $10 million in VW Settlement Funds for EV Charging Station Grants – (LRB-0254/1 Sen. Cowles and Rep. VanderMeer) Grants from these funds would be used to install electric vehicle charging stations at key locations throughout Wisconsin.
  • Energy Storage Sales Tax Exemption – (LRB-1513/1) – Sen. Cowles and Rep. Duchow) This legislation would clarify that battery storage devices installed as part of a renewable energy system should be included in the sales tax exemption that already exists for renewable energy system equipment.

The 75 registered attendees made an impact by taking time out of their busy lives and getting involved in the political process. None of these issues will be easy to pass. In fact, most of them face significant opposition from powerful forces. But working together and building coalitions with pro-renewable energy friends helps get important legislation like this adopted.  

If you would like to learn what you can do to help as well, contact Jim Boullion, Director of Government Relations at jim@renewwisconsin.org.

Wisconsin Awarded $1 Million for Electric Vehicle Planning

Wisconsin Awarded $1 Million for Electric Vehicle Planning

On Thursday, October 21st, the U.S. Department of Commerce Economic Development Administration awarded the State of Wisconsin a $1 million Statewide Economic Development Planning Grant, via the American Rescue Plan, for statewide electric vehicle (EV) adoption initiatives. The grant program is aligned with the Biden Administration’s Build Back Better Agenda to increase U.S. competitiveness and boost the economy.

Wisconsin’s Department of Administration (DOA), in collaboration with the Wisconsin Economic Development Corporation (WEDC) and the Wisconsin Department of Transportation (WisDOT), will administer the grant funds, which will focus on end-user demand, as well as EV charging station planning and EV manufacturing supply chain opportunities. 

The funding will also supplement work already underway by the Wisconsin Office of Sustainability and Clean Energy, which is developing a statewide Wisconsin Clean Energy Plan to implement advanced vehicle technologies like electric vehicles to address Wisconsin’s transportation emissions. The Office is also leading efforts on the newly released Regional Electric Vehicle (REV) Midwest MoU, which will focus on medium and heavy-duty transportation electrification across a five-state region in the Upper Midwest, as well as the Lake Michigan Electric Vehicle Circuit, which will create a light-duty electric vehicle corridor around Lake Michigan.

The potential economic growth and job creation from the grant could be substantial. Aside from creating pathways to reduce Wisconsin’s transportation emissions, the $1 million in public funds could spur a five-fold return on investment and job creation, in addition to $2.60 in private investments for every $1 of public investment spent. This means that the $1 million public investment for electric vehicle initiatives has a potential total return of $7.6 million for Wisconsin’s economic growth and job creation.

Wisconsin Businesses call for Federal Clean Energy Investment to Drive Jobs and Economy

Wisconsin Businesses call for Federal Clean Energy Investment to Drive Jobs and Economy

Thirty-one Wisconsin businesses signed a letter supporting ambitious clean energy investments and broad interest in the American Jobs Plan. The signatories, representing higher education institutions, local governments, and biogas, solar, finance, and electric vehicle industries, are committed to “advancing the clean energy economy, building family-sustaining jobs, and expanding economic opportunities for Wisconsinites.”

The letter states, “Wisconsin’s cumulative solar capacity more than doubled in the past year and is anticipated to quintuple in the next 3-5 years. Wisconsin’s clean energy workforce is 76,000 strong, and solar and advanced transportation jobs proved remarkably resilient even during the economic upheaval of 2020.” Investing in these sectors can create jobs and opportunities for Wisconsin to become a clean energy leader in the Midwest.

The electric vehicle sector is a key focus of the American Jobs Plan and an area where Wisconsin has tremendous opportunity to invest. Recent studies and RENEW’s analysis suggest that the federal stimulus funds spent on transportation electrification will yield a 500% return on investment.

Corry Bullis of U.S. FLO said that “Given President Biden’s goal to deploy 500,000 charging stations by 2030, FLO is expanding its manufacturing footprint to meet increasing demand in the U.S and support its climate and air quality goals. Incentives, as outlined by the American Jobs Plan, will be critical to delivering on this promise. We urge Congress to pass an infrastructure package as soon as possible.”

Wisconsin’s solar job market held steady throughout the pandemic. The industry continues to advance, and local job opportunities are growing rapidly, signaling clean energy investments are a bipartisan solution to growing Wisconsin’s economy and advancing careers for local workers.

Ed Zinthefer, an owner of Arch Electric based in Plymouth, WI, says, “More homeowners and businesses are saving money and supporting local jobs in their neighborhoods by going solar.  We are busier than ever, growing and hiring and building more clean energy projects. It’s a great time to get into clean energy in Wisconsin.”

Even as the renewable energy markets are growing, there is an urgent need to drive investment and expand our workforce. According to the Solar Energy Industry Association, the solar industry is on a trajectory to reach 400,000 solar jobs by 2030. However, employment will need to exceed 900,000 workers by 2035 to reach President Biden’s 100% clean electricity goal.

Sign your name to support federal investment in clean jobs here in Wisconsin!

Legislative Alert: Electric Vehicle Direct Sales in Wisconsin – Public Hearing August 25th

Legislative Alert: Electric Vehicle Direct Sales in Wisconsin – Public Hearing August 25th

The Senate Committee on Government Operations, Legal Review, and Consumer Protection scheduled a public hearing on Senate Bill 462 / Assembly Bill 439 relating to ownership, control, or operation of a motor vehicle dealership and performance of motor vehicle warranty service.

Wednesday, August 25, 2021, 10:00 AM
Room 411 South, State Capitol

Senator Dale Kooyenga (R-Brookfield) and Representative Adam Neylon (R-Pewaukee) introduced legislation to allow a direct sales business model for electric vehicles (EVs) in Wisconsin. If passed, EV manufacturers could sell and deliver their vehicles directly to consumers, either online or from a manufacturer-owned dealership, rather than Wisconsin’s current dealership model. The bill would also clarify that an EV manufacturer can provide warranty and preparation work on vehicles they manufacture in Wisconsin.

RENEW Wisconsin strongly supports this initiative and sent a letter to legislators urging their endorsement. To help pass this legislation, we encourage you to contact your legislators directly or attend the public hearing to register in favor, or even better, speak directly with the committee members. 

The Kooyenga/Neylon bill is one of the keys to increasing EV availability for Wisconsin businesses and consumers and reducing transportation-related greenhouse gas emissions. The internet has completely reimagined how we buy things, opening opportunities, lowering prices, and eliminating many market barriers of the past. The bill would permit Wisconsin’s consumers greater access to EVs that better suit their financial and driving needs by allowing them to purchase directly from the manufacturer-dealership without traveling to Illinois or Minnesota.

If you have any questions or would like to report whether or not your legislators support this legislation, please contact Jim Boullion, Director of Government Affairs at jim@renewwisconsin.org or Jeremy Orr, Emerging Technologies Program Manager at jeremy@renewwisconsin.org.