2015-16 LEGISLATIVE SESSION FINAL REPORT

The Wisconsin Legislature adjourned the regular 2015-16
Session in mid-March skipping the scheduled April floor
period. The closing days of the session saw a flurry of
activity with literally hundreds of bills passing in the closing
days of the floor period. This included action on a number
of bills of interest to utilities and the energy industry.

Outlined below is a summary of the legislation WUI actively
supported during the session which passed both houses
and were signed into law by the Governor.

Weight Limits, AB 122 – This bill exempts utility vehicles
from seasonal weight limits on Class B highways when they
are being utilized to restore utility power after an outage.
The bill was amended to include utility contractors operating
under the same circumstances.
Natural Gas Easements, AB 319 – This bill will require
local governments to grant easements to property under
their jurisdiction to a natural gas utility if the Public Service
Commission finds it’s in the public interest and issues a
“certificate of authority.” The bill incorporates the same
timelines and arbitration procedures that exist under current
law for electric transmission lines.
Nuclear Moratorium, AB 384 – This bill eliminates the
requirements in current law that,
a) there is an operational nuclear waste disposal facility in
the United States and
b) the PSC finds it to be “economically advantageous” in
order to approve the construction of a proposed nuclear
power plant in Wisconsin. These provisions served as a
virtual moratorium on new nuclear power. Passage of this
bill will allow nuclear power to be considered as an option
in the future.
Environmental Liability, SB 545 – This bill allows the
DNR to grant exemptions from ongoing environmental
liability under the Voluntary Party Liability Exemption
program to site remediation projects where the
contaminants are found in lake or river sediment. Site
remediation of old manufactured gas plants often involve
the clean-up of river sediment.
PSC Reform Bill, AB 804 – This bill will make a number
of technical changes to update obsolete statutes, eliminate
duplicative requirements and generally streamline
procedures.
Specific items of interest to electric utilities include:

Eliminate Double Collections: The bill clarifies that the 1.2
percent of utility revenues collected from customers to fund
Focus on Energy applies to retail electric sales only.

Eliminate Unnecessary Filings: The bill eliminates the
requirement to file an annual SO2 emission compliance plan
with the Public Service Commission and the DNR.

Permit Streamlining: The bill allows the DNR to issue
permits with respect to transmission siting prior to final
approval of the project by PSC; prohibits the DNR from
requiring the relocation of facilities as a permit condition
when granting permits for the purposes of maintaining or
repairing utility facilities; and exempts projects involving
the rebuild of existing transmission lines from the
requirement to obtain a “certification or approval” from
the PSC under certain circumstances.

Digger’s Hotline: The bill shifts enforcement of the
Digger’s Hotline law from local district attorneys to the
Public Service Commission.

WISCONSIN ASSEMBLY COMPLETES WORK IN 2016 SESSION

The Wisconsin Assembly concluded what is expected to be
its final floor session on February 18, 2016. The State
Senate plans to return in mid-March for its last floor session
before adjourning for the year. The frenzy of legislative
activity in February included action on a number of energy
issues.

The Senate approved AB 384 that will lift the so-called
nuclear moratorium in Wisconsin. It had passed the
Assembly earlier this year. This legislation eliminates
significant legal hurdles that would have all but prohibited
the siting of a new nuclear plant in Wisconsin should one
be proposed in the future. The bill is awaiting the
Governor’s signature.

The State Assembly also passed a utility regulatory reform
measure, AB 804, which includes provisions streamlining
transmission siting and certain environmental regulatory
processes. This bill is expected to receive Senate approval
when it reconvenes in mid-March.

On the legal front, the U.S. Supreme Court recently stayed
the implementation of the EPA’s Clean Power Plan,
pending resolution of the underlying legal challenge brought
by 27 states including Wisconsin. This federal regulation
would require utilities to significantly reduce carbon dioxide
emission by 2030.  The State’s challenge is currently
pending before the District of Columbia Circuit Court of
Appeals which is set to hear oral arguments June 2 of this
year. The case is likely to be ultimately decided by the
Supreme Court in 2017 at the earliest.

Legislative and Energy Policy Update by James Buchen, WUI Executive Director

James Buchen, WUI Executive Director

The Wisconsin Legislature is
moving at a frenzied pace to
wrap up the 2015-16 session.
They were originally scheduled
to adjourn in April but the
leadership has indicated they
plan to take final action on
pending bills by the end of
February.  As a result things
are moving quickly by
legislative standards with as
many as a dozen hearings a
day on 40 or more bills.

 

There has been relatively little by way of energy policy
discussed in the Capitol this session. The utilities have
pursued a number of minor policy changes such as
legislation that would allow utility vehicles to exceed
seasonal weight limits on highways when responding to
a power outage and a bill that would extend utility aid
payments to counties and municipalities for 5 years, after
a property tax exempt generating facility is shut down.
There was little opposition to these measures and they
passed both houses and were signed into law by the
Governor.

One issue that has received more attention this session
is a bill that would repeal the virtual moratorium on the
construction of nuclear power plants in Wisconsin. With
concerns over global warming and carbon dioxide emissions
from coal fired power plants growing, there is renewed
interest in nuclear power as a zero emission option.  While
no company has proposed building a nuclear facility in
Wisconsin, passage of this bill would eliminate one legal
hurdle, if such a proposal emerged in the future. The bill
passed the State Assembly in January and is awaiting a
vote in the State Senate.  Perhaps the biggest energy policy
issues facing Wisconsin, as well as the rest of the country,
is implementation of the Federal Clean Power Plan, which
requires Wisconsin utilities to reduce carbon dioxide
emissions by 41 percent by the year 2030. Carbon dioxide
is a natural by-product of burning fossil fuels.  Utility CO2
emissions in 2012 amounted to 1996 lbs. per megawatt
hour of power generation.  As a result, achieving reductions
of this magnitude will be a daunting task.

Under the federal regulation the specific plans on how to
achieve reductions of this magnitude is left to the states.
Wisconsin utilities are looking to the Department of Natural
Resources to develop a plan so they can begin their planning
process to achieve compliance by the various deadlines in
the federal rule. The rule has triggered lawsuits from the
various states and could be affected by the outcome of the
Presidential election. This promises to remain a contentious
energy policy issue in the years ahead.

New Law Will Aid Local Governments Affected by Power Plant Closures

A new state law will help Kewaunee County cope with an unusual tax dispute involving the shuttered nuclear power plant on Lake Michigan east of Green Bay. The bill has been signed by Governor Scott Walker. It enables communities to experience a more gradual reduction in revenue if other power plants around the state close. The new law revises the way local governments are compensated after power plants are decomissioned. Lawmakers and local officials had said the bill was needed because counties would have experienced a sharp reduction in their revenues from the disappearance of utility aid payments. The state has imposed caps on local property tax levies.

Utility tax payments are currently offset by payments a power plant owner makes on its property taxes. A new assessment from the Town of Carlton claimed that the value of the Kewaunee nuclear plant was $457 million. The plant is being decommissioned. Dominion, which is fighting that assessment in court, is expected to pay a sizable increase in its property taxes next year, but the county will have to offset that by reducing taxes for everyone else in the county.  As a result, the county wouldn’t be able to keep the extra funds it collects from Dominion. Under the bill, taxes for other property owners would still go down, but the county wouldn’t see the loss of the utility aid payments.

WUI Day at the Capitol Energizes Attendees

PSC Chair Ellen Nowak speaking at the 2015 Day at the Capitol event.

WUI held its biennial Day at the Capitol on May 7, 2015.  The
successful event drew more than 100 WUI Members from across
the state of Wisconsin. These shareholders were able to put a
face on the organization in a true grassroots effort which touched
20 Senators and 38 Assemblymen. Members were welcomed by
Chairman of the Board, Roger Cole. James Buchen, Executive
Director WUI, provided a Legislative Review of current State and
National Issues. Representative Mike Kuglitsch, Chair of the
Committee on Energy and Utilities, was joined by Todd Stewart,
Executive Director of Wisconsin Industrial Energy Group, to lead a
panel discussion concerning utility issues.

Members were greeted by a beautiful day in which to walk across
the street from the Inn on the Park to the Capitol for their
constituent meetings with their Senators and Representatives.
Upon returning from the Capitol, members enjoyed lunch followed
by a presentation from by Ellen Nowak, Chairperson of the Public
Service Commission (PSC) of Wisconsin. Chairperson Nowak
briefed members on both state and national utility issues and
explained the Commission’s perspective on distributed generation
and the need for fixed charges to better reflect fixed costs to
ensure that all customers shoulder their fair share of the cost of
the infrastructure needed to deliver electricity on demand.

The Wisconsin Utility Investors Board of Directors would like
to thank the speakers and panelists, former WUI Executive
Director Bob Seitz, government relations representatives from
our state utilities, and most importantly all the WUI Members
— we appreciate you!

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