Plan to boost utility rates draws critics; another hearing to be set

From an article by Tom Content in the Milwaukee Journal Sentinel:

We Energies customers weighed in on the utility's proposed rate increase on Tuesday, raising concerns about the utility's proposal to recoup revenue lost to sales declines caused by the recession.

But technical glitches at the hearing prompted the Public Service Commission to announce that another hearing will be scheduled at a later date.

At issue is a proposed $189 million price increase for electricity, as well as increases proposed for local natural gas charges and steam bought by Milwaukee and Wauwatosa businesses.

More than 40 people attended the afternoon hearing at Serb Hall on Milwaukee's south side, a bigger crowd than for any hearing on a We Energies rate case over the past six years.

Sandra Larson of Elm Grove said it's understandable that more revenue would be needed for certain things, such as building power plants.

"But to include an increase for lost revenue and pension plans while We Energies customers are conserving could be considered just plain greed," she said. "We Energies should get back to serving their customers and not penalizing them."

The hearing was conducted via speakerphone, as opposed to a video conferencing system that was used two years ago for the last rate increase proposal.

But the technical glitches made it difficult for the administrative law judge on the other end of the telephone, in Madison, to hear what customers in Milwaukee were saying, and the Madison-Milwaukee phone connection failed twice. More than a dozen customers left the hearing in frustration.

"This is not acceptable," commission chairperson Eric Callisto said in a statement. "I have asked staff to schedule another hearing to make sure that everybody who wants to be heard on these critical issues is heard."

Seven careers in wind farm development

From an article by Sarah Lozanova in RenewableEnergyWorld.com:

Currently about 85,000 people are employed in the wind energy industry, up from 50,000 last year. These jobs are very diverse, and include turbine manufacturing, wind farm development, wind farm construction, and turbine maintenance.

Developing an industrial-scale wind farm requires a team of people with a variety of abilities. Here's a look at some of the jobs involved as well as the skills necessary for this line of work. . . .

Dueling survey results differ on climate change and energy

Two surveys released on September 28, 2009, produced widely different results on Wisconsinites' opinions on climate change and renewable energy.

From a news release about the survey conducted by the Forest County Potawatomi:

[Crandon, Wisc.] In anticipation of state legislation to reduce greenhouse gasses which cause climate change, a recent statewide poll shows a majority of Wisconsin voters favor action by the State of Wisconsin to reduce carbon emissions.

When asked, “Do you favor or oppose the State of Wisconsin taking action to reduce (its) emissions of gases like carbon dioxide in Wisconsin that cause global warming?” nearly three-fourths of voters (70%) favor the State of Wisconsin taking action to reduce carbon emissions. Only 24% of voters oppose taking action.

Support for action to reduce emissions also crosses party lines, with majorities of Republicans (53%), independents (67%) and Democrats (87%) favoring action by the State of Wisconsin.

“Carbon pollution threatens to dramatically change our world for the worse,” said Forest County Potawatomi Attorney General Jeff Crawford. “We have a responsibility to our children and grandchildren to be good stewards of the environment.”

The poll also found that two-thirds of Wisconsin voters favor requiring utilities to generate 25% of their electricity from renewable sources by 2025.

From the press release on the survey conducted by Wisconsin Manufacturers and Commerce:

MADISON – With jobs dominating the public’s mind, a statewide poll of voters found over 60 percent say Wisconsin should not enact its own global warming policies, favoring national and international approaches, WMC reported Monday.

Also, voters oppose global warming proposals that hit them in the pocketbook with increased energy prices or potential job losses, the poll found. In 2007, Governor Jim Doyle convened a Global Warming Task Force that called for numerous new regulations to limit greenhouse gas emissions. The Legislature is likely to consider some of those proposals later this session.

Xcel Energy CEO Interview: Richard Kelly

From an interview with Richard Elly, CEO of Xcel Energy, posted on Yahoo! Finance:

TWST: Would you begin with an overview of Xcel Energy and a picture of the things that the company is doing at the present time?

Mr. Kelly: Xcel Energy is the fifth-largest gas and electric utility in the United States. We serve eight states, with the largest ones being Minnesota, Colorado, Texas and a substantial portion of western Wisconsin, and we provide service to approximately 3.4 million electric and 1.9 million natural gas customers. We are a fully integrated, regulated utility, and our strategy is to grow the core, which means we are going to stay in the regulated side of the business. Our goal is to be an environmental leader, which I believe we have accomplished. We've done a lot of good work on the environmental side.

TWST: What are the most significant trends or developments that you anticipate in your markets over the next two to three years?

Mr. Kelly: One of the things that I worry about most for Xcel Energy is public policy and how that will evolve. I'm specifically referring to some kind of energy bill or legislation on carbon emissions and global warming, and the impact that's going to have on all utilities, including Xcel Energy. It is for this reason we've worked on our environmental strategy for the past several years. For example, strong demand-side management, large renewable energy and carbon reduction are all aspects we have worked on so that we are prepared for whatever legislation comes out of Washington, D.C. Alternatively, if nothing comes from the federal government, then at a minimum we would be in line with meeting the states' requirements.

TWST: What are the growth opportunities that you see for this company?

Mr. Kelly: The major growth opportunity is going to be investment in our environmental leadership strategy. Investment in wind, solar and biomass present great opportunities for us. We are blessed with the geography in the middle part of the United States, where there is abundant wind. And as you get farther down south, obviously there is abundant solar, and in the Midwest we have a lot of opportunities for biomass. So while the customer growth might be less going forward, as people become more conscious of energy efficiency, we'll still be able to maintain our growth because of these opportunities we have on the environmental side.

Seven careers in wind farm development

From an article by Sarah Lozanova in RenewableEnergyWorld.com:

Currently about 85,000 people are employed in the wind energy industry, up from 50,000 last year. These jobs are very diverse, and include turbine manufacturing, wind farm development, wind farm construction, and turbine maintenance.

Developing an industrial-scale wind farm requires a team of people with a variety of abilities. Here's a look at some of the jobs involved as well as the skills necessary for this line of work. . . .

Turbines' negative impact on property value "quite a reach"

From an article by Colleen Kottke in The Northwestern (Oshkosh):

In the years since the Forward Wind Energy Center came on line, "For Sale" signs have popped up all over Gerry Meyer's rural neighborhood in the town of Byron. . . .

Meyer is convinced that the aesthetically displeasing look of the 400-foot turbines and subsequent ill effects experienced by nearby residents from the noise, vibration and light-flicker has caused housing values to plummet.

A just-released study commissioned by wind-power opponents concurs, saying that property values have fallen at least 19 percent for properties located near the We Energies wind farm in Fond du Lac County and 12 percent for those located near Invenergy's Forward Wind Energy Center in Fond du Lac and Dodge counties.

The study by Appraisal Group One was commissioned by a Calumet County affiliate of the state Coalition for Wisconsin Environmental Steward, a group fighting a We Energies wind farm project in Columbia County.

'Quite a reach'
Brian Manthey, a spokesman for We Energies, said the report failed to make accurate comparisons in properties used to track declining values.

"They compared subdivision and lake view lots when the properties in our wind farm area were considered agricultural lots back in 2006. Ultimately, they figured in the sale of four lots, which is tough to draw any comparisons when using such a small scale," said Manthey, who described the report's findings as "quite a reach."

Since construction of the 88-turbine project in the Blue Sky Green Field project in the towns of Calumet and Marshfield, Manthey said 12 homes have been sold; some homes sold above assessed value while others sold below fair market values. Manthey said the report is misleading in that it doesn't take into consideration other factors impacting property values.

DOE names MGE green power program nation's best

From a news release issued by Madison Gas and Electric:

Madison, Wis., Sept. 16, 2009—Madison Gas and Electric (MGE) received the U.S. Department of Energy's (DOE) Utility Green Power Program of the Year Award. The award was announced at the Green Power Leadership Awards banquet in Atlanta, Georgia.

DOE's awards recognize the country's top individuals, companies and organizations that are significantly advancing the development and use of green energy. "The Department of Energy applauds these organizations for taking a leading role in advancing markets for renewable energy," said Secretary Steven Chu.

"We share this prestigious award with our customers who helped us achieve this top national ranking," said Gary Wolter, MGE chairman, president and chief executive officer.

MGE was recognized for expanding its wind power program by eight times, significantly reducing the price premium and growing the number of participants purchasing 100% green power to 70%. The company was also recognized for its Clean Power Partners program which helped stimulate the local solar market through education and a premium buyback rate. Ten percent of MGE's electric customers purchase some or all of their electricity from renewable resources. MGE's green pricing program has the second highest participation rate of all investor-owned utilities in the country according to the National Renewable Energy Laboratory.

Biomass plant plan triggers questions

From an article by Tom Content in the Milwaukee Journal Sentinel:

A proposal by We Energies to generate power by burning waste wood at a Wisconsin paper mill comes at a time when the paper industry and environmentalists have raised concerns about another wood-burning power plant in northern Wisconsin.

The Milwaukee utility this month said it wants to build a $250 million power plant near Wausau in Rothschild that would generate 50 megawatts of electricity, enough to power 40,000 homes.

The biomass project is in response to the state's renewable energy mandate that requires 10% of Wisconsin's electricity to come from wind turbines, solar panels and other renewable sources by 2015.

Plans for another project in Ashland on Lake Superior have raised concerns about the impact of the plant on the state's papermaking industry.

The Wisconsin Paper Council and the Flambeau River Papers in Park Falls have raised concerns about plans by Xcel Energy Corp. to convert a coal-fired boiler in Ashland to burn wood.

If approved by state regulators, the Ashland site would become the biggest biomass power plant in the Midwest, Xcel said last year.

The Clean Wisconsin environmental group sought a review of the Ashland plant to determine the impact on northern forests and greenhouse gas emissions.

And Flambeau River Papers of Park Falls raised questions about whether the Xcel project would raise prices for wood that would be used in a bio-refinery that Flambeau intends to build to make biodiesel and wax.

New wind project rules clear Assembly; await Doyle's signature

IMMEDIATE RELEASE
September 16, 2009

MORE INFORMATION
Michael Vickerman
RENEW Wisconsin
608.255.4044
mvickerman@renewwisconsin.org

Wisconsin wind energy prospects advanced with bipartisan Assembly support for legislation to set uniform statewide permitting rules.

Under the Wind for Wisconsin umbrella, more than 60 organizations as diverse as unions, trade associations, environmental advocates, health groups, and renewable energy manufacturers sought uniform permitting standards for future wind developments.

As in the State Senate, Senate Bill 185 won bipartisan approval from 48 Democrats and 17 Republicans voting in favor of passage.

Michael Vickerman, executive director of RENEW Wisconsin, a nonprofit sustainable energy advocacy organization, expects Governor Doyle to sign the bill into law.

“The Assembly’s vote is critical to reviving the development of a high priority renewable energy resource in accordance with Wisconsin energy policy,” said Vickerman.

“We believe that wind energy suppliers will see the action as an invitation to locate and do business in Wisconsin. Our economy will benefit from the investment and jobs in a sustainable energy future,” Vickerman said.

“We look forward to working with the Public Service Commission in shaping the specific standards for permitting wind projects,” Vickerman said.

“RENEW and our members thank Rep. James Soletski (D-Green Bay) and Rep. Phil Montgomery (R-Green Bay) for guiding the proposal through the Assembly. The entire legislature should be proud of this accomplishment, which we view as a prerequisite for a more aggressive renewable energy standard likely to be included in a comprehensive global warming legislative package,” commented Vickerman.

The bill now goes to Governor Doyle for his signature before becoming law.

Read additional statements from Rep. James Soletski and Assembly Speaker Mike Sheridan.

Do wind installations need one-to-one backup? No.

Comments from Jeff Anthony of the American Wind Energy Association (AWEA):

[Backup for wind] is a very complex issue. Here are my attempts at (hopefully) simple explanations for why the following four statements are, in all four cases, not really accurate. From a wind power perspective, the four statements amount to the same thing.

STATEMENT: "they (utility) still have to maintain adequate fossil and nuclear capacity for dealing with times without wind."

** Not really, no. Utilities need to plan for both capacity and energy -- wind power is great at providing energy, but does not provide a lot of capacity. So utilities add wind energy mainly to add an energy resource to their mix, to keep energy costs down, to meet renewable energy requirements, and to lower their levels of harmful air emissions. If load growth occurs at a higher enough level (which it is NOT doing presently), they may need to add capacity, too, which wind projects provide a bit, but if they need larger amounts of capacity they would likely look at natural gas plants in the near term and other forms of generation in the long term.

STATEMENT: "[Necessary backup] is the primary reason why utilities charge one to two cents more for each kilowatt-hour coming from wind farms."

** This is not the case. Utilities do not charge an extra amount in their rates for each kilowatt-hour of energy coming from wind farms anymore that they charge customers an extra capacity charge to provide a reserve margin (e.g., back-up capacity) for when a coal or nuclear plants trips off line and another unit is available to accommodate the loss of a 500 MW coal or nuclear unit. Utilities have a wide range of resources to provide both capacity and energy, and then need to meet requirements to have reserves of capacity and at the same time adequate amounts of energy to meet their customers needs at all times.

STATEMENT: "Each MW of wind farm capacity needs to be offset by a standby MW of natural gas-fired combustion turbine generator capacity."

** Again, this is not needed, no. This is a very common misperception, that assumes a utility installing a 100 MW wind plants is relying on that project for 100 MW of capacity. That is not the case -- utilities install or buy primarily ENERGY from wind projects -- not capacity.

Whatever capacity credit they can take for a wind project is really often a "bonus". You add wind projects to provide cost-effective, emissions-free, price-assured energy. If you need to add capacity, you're going to look to some other generating technology in most cases.

STATEMENT: "So, from a utility standpoint, you have to add the cost of both (wind turbine and combustion turbine) together before you compare wind to coal or nuclear capacity."

** No, this would lead to erroneous conclusions. Would one think that you would take the cost of a two-unit nuclear plant and increase it by 50% because you need to have another unit available if one unit of the nuclear plant trips off line at some point ? Of course not. One needs to view adding wind power in the broadest context of how utilities systems are planned, operated and balanced by their operators.

The correct statement above would be "from a utility standpoint, you need to add a small, incremental amount to the energy costs from a wind project to accommodate the variable nature of the wind energy output to ensure that adequate resources / ancillary services are available from the rest of the utility grid. This incremental cost is typically around $5 per megawatt-hour and adds a relatively small, incremental cost to wind energy when these integration costs are calculated." [For more info, refer to UWIG: www.uwig.org ]

State Senate strongly backs new rules for wind projects

IMMEDIATE RELEASE
September 15, 2009

MORE INFORMATION
Michael Vickerman
RENEW Wisconsin
608.255.4044
mvickerman@renewwisconsin.org

In a show of bipartisan support, the State Senate approved legislation that will open the door to new wind energy projects in Wisconsin.

Under the Wind for Wisconsin umbrella, more than 60 organizations as diverse as unions, trade associations, environmental advocates, health groups, and renewable energy manufacturers sought uniform permitting standards for future wind developments.

Six Republicans joined 17 Democrats to pass Senate Bill 185. The legislation directs the Public Service Commission to begin a rulemaking process that will lead to greater certainty and predictability in siting wind generation facilities.

“The Senate’s vote is critical to reviving the development of a high priority renewable energy resource in accordance with Wisconsin energy policy,” said Michael Vickerman, executive director of RENEW Wisconsin, a nonprofit sustainable energy advocacy organization.

“We believe that the wind energy suppliers will see the action as an invitation to locate and do business in Wisconsin. Our economy will benefit from the investment and jobs in a sustainable energy future,” Vickerman said.

“RENEW Wisconsin and its members thank the bill’s primary authors, Senator Jeff Plale (D-South Milwaukee) and Senator Randy Hopper (R-Fond du Lac), the leadership of both parties, and all of the state senators who recognized the need for a statewide approach to permitting windpower installations,” Vickerman added .

The Assembly will vote on the companion bill later this week. Then it will go to the governor.

Cheaper power; higher costs

From an article by Judy Newman in the Wisconsin State Journal:

Demand for electricity has dropped nationwide this year, holding down the price of power that one utility sells to another.

That is translating into a bit of a price break for Wisconsin consumers, but not a huge one, utility officials and regulators said.

Wholesale electricity prices in parts of the U.S. fell as much as 40 percent from a year ago as the need for power dipped 4.4 percent during the first half of 2009, according to a recent report by Monitoring Analytics, which assesses results of PJM Interconnection, a regional transmission company covering 13 states and the District of Columbia. (Wisconsin is not a PJM state.)

In Wisconsin, though, the five major utility companies - including Wisconsin Power & Light and Madison Gas & Electric - are asking for a total of about $300 million in rate increases to take effect in January. WPL alone is seeking about $94 million from its electricity customers.

"What drives rates are fuel prices and construction," said Robert Norcross, administrator of the gas and electric division for the state Public Service Commission.

Wind power projects are in the works, such as WPL's Bent Tree wind farm planned in southeast Minnesota, and the Oak Creek coal-fired plants owned primarily by We Energies, Milwaukee, are scheduled to come online in the next year and a half.

In addition, WPL needs to cover past construction project costs, said spokesman Rob Crain. He said the PSC did not authorize higher rates for the Madison utility company for 2009, expecting that increased revenues would pay at least part of the expense of installing the Cedar Ridge wind farm in Fond du Lac County and the natural-gas-fueled Neenah power plant. Instead, sales "dropped significantly," Crain said, so "there are fixed costs we are not recouping on those two capital investments made on behalf of our customers."

Numerous factory closings and curtailments have reduced the need for electricity, such as the General Motors plant in Janesville, which ceased most production last December. But that just leaves utilities with fewer ratepayers to carry the costs.

2010 RFP issued – Environmental & Economic Research

Wisconsin's Focus on Energy Environmental and Economic Research and Development Program (EERD) is pleased to announce $860,000 in grant funding available for 2010 research projects that study the environmental and economic impacts of electricity and natural gas use in Wisconsin. EERD is looking for projects that study the environmental or economic impacts of:

- Renewable energy or energy efficiency initiatives
- Biomass energy production and use to offset electric generation and/or natural gas
- Climate change in Wisconsin due to electricity or natural gas use
- Impact of existing fossil fuel-fired electric power generation on PM 2.5 levels in Wisconsin

Any research organization with a project relevant to Wisconsin can apply for a grant. The EERD Research Forum will evaluate proposals and make funding recommendations. We expect to announce funded projects in January 2010.

Prospective applicants must submit an Intent to Propose form by October 8, 2009 and those invited to submit a full proposal must send it electronically by 12 p.m. on November 11, 2009. The 2010 Request for Proposals, Intent to Prose form and other information can be found on the Focus on Energy website.

Ingrid Kelley
Program Manager
Focus on Energy
Environmental and Economic Research and Development Program
608.238.8276, x136

We Energies plans biomass plant Rothschild mill site

From a news release issued by We Energies:

ROTHSCHILD, Wis. – We Energies announced today the proposed construction of a $250 million biomass-fueled power plant at Domtar Corporation’s Rothschild, Wisconsin paper mill site. Wood, waste wood and sawdust will be used to produce 50 megawatts of electricity and will also support Domtar’s sustainable papermaking operations. The project would be funded by We Energies.

The partnership between We Energies and Domtar will result in a highly efficient use of resources and will add another technology to We Energies’ renewable energy portfolio.

That portfolio includes the state’s largest wind development -- the 145 megawatt Blue Sky Green Field Wind Energy Center in Fond du Lac County and the proposed 162 megawatt Glacier Hills Wind Park in Columbia County. Together, these three projects will be capable of delivering nearly 360 megawatts of renewable energy, enough to supply approximately 120,000 homes. . . .

Under Wisconsin law, utilities statewide must use renewable energy to meet 10 percent of the electricity needs of retail customers by the year 2015.

The project is expected to create approximately 400 construction jobs and 150 permanent jobs in the surrounding community, including independent wood suppliers and haulers from northern and central Wisconsin who will secure waste wood for the project.