US EPA Clean Power Plan
This June, the United States Environmental Protection Agency (EPA) released a draft rule to reduce carbon dioxide (CO2) emissions from existing power plants under section 111(d) of the Clean Air Act. The proposed rule is over 2,000 pages and is very complex. The draft rule requires Wisconsin to reduce emissions by 34 percent by the year 2030, on baseline 2012 emissions of 1,827 lb CO2/MWh-net. MEUW is most concerned that Wisconsin utilities are not receiving credit for investments made in emissions controls, renewable energy and energy efficiency that occurred prior to 2012. Many of our members have reduced greenhouse gas emissions by 23 percent since 2005 through their ownership of WPPI Energy. We are also concerned that Wisconsin does not receive credit for investments in renewable energy made located in other states. Our final concern is logistical issues centered on running combined cycle natural gas fired generators in Wisconsin to run 70 percent of the time - they were not designed to operate that frequently and Wisconsin lacks sufficient gas pipeline capacity to support that level of operation.
MEUW is working with a broad stakeholder group in Wisconsin that includes the Public Service Commission, Department of Natural Resources, investor-owned utilities, joint action agencies, cooperatives and various customer groups. The group is developing a comprehensive list of comments and issues for the EPA to consider. MEUW has also communicated concerns with their U.S. congressional delegation and key state legislators.
In recent years, residential and commercial customers have installed solar generating panels (solar PV) at their homes and businesses due to environmental concerns and to reduce their electric bills. These installations are referred to as distributed generation (DG) because the power is produced at the point of consumption. DG customers are typically compensated when they provide power to the grid and charged when they consume more power than they can generate. Their bills may net to zero, or the utility may pay the customer if they generate more than they use. MEUW members are not opposed to DG because a significant number of our members have DG systems in their communities. However, DG does create several policy issues for Wisconsin. DG customers effectively avoid paying costs to maintain and operate the grid because the customer charge portion of the electric bill rarely reflects the full amount of fixed costs to operate and provide reliable service. They avoid paying for the grid even though they use it every day - to return excess power their systems produce, to receive backup power at night or on cloudy days, or when their systems require maintenance. This comes down to an issue of basic customer fairness. It is about making sure that everyone who uses the electric grid pays their appropriate share of the cost of using the system. Effectively, all customers who do not own a DG system see a cost increase every time a DG system is installed.
Recent rate cases by the state’s investor-owned utilities have highlighted the fact that current rate structures do not adequately separate distribution system costs from the energy charge. Rate structures need to send appropriate price signals to all customers and prevent residential customers from subsidizing those that choose to install solar PV. MEUW is communicating their concerns to key state legislators and will continue to work with PSC staff to develop appropriate rates that allow members to recover distribution costs via the fixed charge.
Smart Metering Systems
A bill was introduced in the 2013-2014 legislative session that would have required public utilities and cooperatives to offer an opt-out tariff to customers who chose not to have a smart meter installed at their home. MEUW opposed this bill because of the widespread misconceptions about what smart meters are, how they work, and why our member utilities are deploying this technology.
Installation of smart metering systems allows our members to take advantage of operational efficiencies that technological advances bring. Customer service staff is able to use real time usage data to notify a customer of high usage, which allows our members to provide proactive customer service.
MEUW continues to work with state legislators to educate them on the operational benefits of smart metering systems and the common misconceptions related to privacy and health issues.