AB389,52,1511 196.485 (6m) Dividends, profits and gains. The commission may not treat any
12dividend received by a transmission utility from the transmission company or any
13gain or profit of a transmission utility from the sale or other disposition of securities
14issued by the transmission company as a credit against the retail revenue
15requirements of the transmission utility.
AB389, s. 58 16Section 58. 196.485 (7) of the statutes is created to read:
AB389,52,1917 196.485 (7) Enforcement. A wholesale or retail customer of a public utility
18affiliate may petition the circuit court for Dane County for specific performance of
19a commitment filed under sub. (5) (a) 2. or 3.
AB389, s. 59 20Section 59. 196.485 (8) of the statutes is created to read:
AB389,52,2521 196.485 (8) Penalties. A public utility affiliate that fails to complete the
22contribution of transmission facilities to the transmission company by the
23completion date specified in the filing under sub. (5) (a) 2. shall forfeit $25,000 for
24each day that completion of the contribution is delayed if the transmission company
25is legally able to accept the contribution.
AB389, s. 60
1Section 60. 196.487 of the statutes is created to read:
AB389,53,2 2196.487 Reliability of electric service. (1) Definitions. In this section:
AB389,53,33 (a) "Public utility affiliate" has the meaning given in s. 196.795 (1) (L).
AB389,53,44 (b) "Transmission company" has the meaning given in s. 196.485 (1) (ge).
AB389,53,13 5(2) Commission order. If the commission determines that a public utility
6affiliate or the transmission company is not making investments in the facilities
7under its control that are sufficient to ensure reliable electric service, the commission
8shall order the public utility affiliate or transmission company to make adequate
9investments in its facilities that are sufficient to ensure reliable electric service. An
10order under this subsection shall require the public utility affiliate or transmission
11company to provide security in an amount and form that, to the satisfaction of the
12commission, is sufficient to ensure that the public utility affiliate or transmission
13company expeditiously makes any investment that is ordered.
AB389,53,16 14(3) Cost recovery. The commission shall allow a public utility affiliate that is
15subject to an order under sub. (2) to recover in its retail electric rates the costs that
16are prudently incurred in complying with the order.
AB389, s. 61 17Section 61. 196.491 (3) (d) 3r. of the statutes is created to read:
AB389,53,2218 196.491 (3) (d) 3r. For a high-voltage transmission line that is proposed to
19increase the transmission import capability into this state, existing rights-of-way
20are used to the extent practicable and the routing and design of the high-voltage
21transmission line minimizes environmental impacts in a manner that is consistent
22with achieving reasonable electric rates.
AB389, s. 62 23Section 62. 196.491 (3) (d) 3t. of the statutes is created to read:
AB389,54,424 196.491 (3) (d) 3t. For a high-voltage transmission line that is designed for
25operation at a nominal voltage of 345 kilovolts or more, the high-voltage

1transmission line provides usage, service or increased regional reliability benefits to
2the wholesale and retail customers or members in this state and the benefits of the
3high-voltage transmission line are reasonable in relation to the cost of the
4high-voltage transmission line.
AB389, s. 63 5Section 63. 196.491 (3) (gm) of the statutes is created to read:
AB389,54,206 196.491 (3) (gm) The commission may not approve an application filed after the
7effective date of this paragraph .... [revisor inserts date], under this section for a
8certificate of public convenience and necessity for a high-voltage transmission line
9that is designed for operation at a nominal voltage of 345 kilovolts or more unless the
10approval includes the condition that the applicant shall pay the fees specified in sub.
11(3g) (a). If the commission has approved an application under this section for a
12certificate of public convenience and necessity for a high-voltage transmission line
13that is designed for operation at a nominal voltage of 345 kilovolts or more that was
14filed after April 1, 1999, and before the effective date of this paragraph .... [revisor
15inserts date], the commission shall require the applicant to pay the fees specified in
16sub. (3g) (a). For any application subject to this paragraph, the commission shall
17determine the cost of the high-voltage transmission line, identify the counties,
18towns, villages and cities through which the high-voltage transmission line is routed
19and allocate the amount of investment associated with the high-voltage
20transmission line to each such county, town, village and city.
AB389, s. 64 21Section 64. 196.491 (3g) of the statutes is created to read:
AB389,55,422 196.491 (3g) Fees for certain high-voltage transmission lines. (a) A person
23who receives a certificate of public convenience and necessity for a high-voltage
24transmission line that is designed for operation at a nominal voltage of 345 kilovolts
25or more under sub. (3) shall pay the department of administration an annual impact

1fee as specified in the rules promulgated by the department of administration under
2s. 16.969 (2) (a) and shall pay the department of administration a one-time
3environmental impact fee as specified in the rules promulgated by the department
4of administration under s. 16.969 (2) (b).
AB389,55,85 (b) A person that pays a fee under par. (a) may not use the payment to offset
6any other mitigation measure that is required in an order by the commission under
7sub. (3) regarding the certificate of public convenience and necessity specified in par.
8(a).
AB389, s. 65 9Section 65. 196.491 (3m) (b) 2. of the statutes is amended to read:
AB389,55,1410 196.491 (3m) (b) 2. The analytical process specified in subd. 1. b. shall, to the
11extent practicable, be consistent with the analytical process described in the merger
12enforcement policy of the federal department of justice and the federal trade
13commission regarding horizontal acquisitions and mergers that are subject to 15
14USC 1
, 18 or 45
, as defined in s. 196.485 (1) (dr).
AB389, s. 66 15Section 66. 196.494 (3) of the statutes is amended to read:
AB389,55,2416 196.494 (3) No later than December 31, 2004, the The commission may shall,
17under this subsection, issue an order requiring an electric utility to construct or
18procure, on a competitive basis, the construction of transmission facilities specified
19by the commission in its order if the commission determines that, based on the
20results of the study under sub. (2),
such construction is necessary to relieve a
21constraint on a transmission system and the construction will materially benefit the
22customers of the electric utility or other electric utilities or of an independent system
23operator, as defined in s. 196.485 (1) (d), or independent transmission owner, as
24defined in s. 196.485 (1) (dm).
AB389, s. 67 25Section 67. 196.494 (5) of the statutes is created to read:
AB389,56,6
1196.494 (5) The governor may, on behalf of this state, enter into an interstate
2compact that establishes a joint process for the states in the upper midwest region
3of the United States to determine the need for and siting of regional electric
4transmission facilities that may affect electric service in this state. The governor
5may not enter into a compact under this subsection unless the compact includes
6requirements and procedures for establishing each of the following:
AB389,56,87 (a) Compliance with each state's environmental and siting standards for
8transmission facilities.
AB389,56,99 (b) A regional need determination for transmission facilities.
AB389,56,1110 (c) A mechanism for resolving conflicts between the states regarding the siting
11of transmission facilities.
AB389, s. 68 12Section 68. 196.52 (3) (a) of the statutes is amended to read:
AB389,57,1713 196.52 (3) (a) In this subsection, "contract or arrangement" means a contract
14or arrangement providing for the furnishing of management, supervisory,
15construction, engineering, accounting, legal, financial or similar services and any
16contract or arrangement for the purchase, sale, lease or exchange of any property,
17right, or thing, or for the furnishing of any service, property, right, or thing, other
18than management, supervisory, construction, engineering, accounting, legal,
19financial or similar services, but "contract or arrangement" does not include a
20contract or arrangement under which a transmission utility, as defined in s. 196.485
21(1) (i), sells or transfers securities, as defined in s. 196.485 (1) (fe), that have been
22issued by a transmission company, as defined in s. 196.485 (1) (ge)
. Except as
23provided under par. (b), unless and until the commission gives its written approval,
24any contract or arrangement is not valid or effective if the contract or arrangement
25is made between a public utility and an affiliated interest after June 7, 1931. Every

1public utility shall file with the commission a verified copy of any contract or
2arrangement, a verified summary of any unwritten contract or arrangement, and
3any contract or arrangement, written or unwritten, which was in effect on June 7,
41931. The commission shall approve a contract or arrangement made or entered into
5after June 7, 1931, only if it shall clearly appear and be established upon
6investigation that it is reasonable and consistent with the public interest. The
7commission may not approve any contract or arrangement unless satisfactory proof
8is submitted to the commission of the cost to the affiliated interest of rendering the
9services or of furnishing the property or service to each public utility or of the cost
10to the public utility of rendering the services or of furnishing the property or service
11to each affiliated interest. No proof is satisfactory under this paragraph unless it
12includes the original (or verified copies) of the relevant cost records and other
13relevant accounts of the affiliated interest, or an abstract of the records and accounts
14or a summary taken from the records and accounts if the commission deems the
15abstract or summary adequate. The accounts shall be properly identified and duly
16authenticated. The commission, where reasonable, may approve or disapprove a
17contract or arrangement without submission of the cost records or accounts.
AB389, s. 69 18Section 69. 196.795 (1) (g) 1. of the statutes is amended to read:
AB389,57,2119 196.795 (1) (g) 1. As a beneficial owner, to take, hold or acquire 5% or more of
20the outstanding voting securities of a public utility, other than a transmission
21company,
with the unconditional power to vote those securities.
AB389, s. 70 22Section 70. 196.795 (1) (g) 2. of the statutes is amended to read:
AB389,58,223 196.795 (1) (g) 2. To exchange or convert 50% or more of the outstanding voting
24securities of a public utility, other than a municipality or other political subdivision
25or a transmission company, for or into the voting securities of a company organized,

1created, appointed or formed by or at the direction of the public utility or of a
2subsidiary of such company.
AB389, s. 71 3Section 71. 196.795 (1) (h) 3. of the statutes is created to read:
AB389,58,44 196.795 (1) (h) 3. "Holding company" does not include a transmission company.
AB389, s. 72 5Section 72. 196.795 (1) (p) of the statutes is created to read:
AB389,58,76 196.795 (1) (p) "Transmission company" has the meaning given in s. 196.485
7(1) (ge).
AB389, s. 73 8Section 73. 196.795 (5) (i) 1. of the statutes is amended to read:
AB389,58,129 196.795 (5) (i) 1. Shall consider the public utility affiliate as a wholly
10independent corporation and shall impute a capital structure to the public utility
11affiliate and establish a cost of capital for the public utility affiliate on a stand-alone
12basis
;
AB389, s. 74 13Section 74. 196.795 (5) (p) 1., 2., 3. and 4. of the statutes are renumbered
14196.795 (6m) (b) 1., 2., 3. and 4.
AB389, s. 75 15Section 75. 196.795 (5) (pm) 1. (intro.) of the statutes is repealed.
AB389, s. 76 16Section 76. 196.795 (5) (pm) 1. a. of the statutes is renumbered 196.795 (6m)
17(a) 3.
AB389, s. 77 18Section 77. 196.795 (5) (pm) 1. b. of the statutes is renumbered 196.795 (6m)
19(a) 5.
AB389, s. 78 20Section 78. 196.795 (5) (pm) 1. c. of the statutes is renumbered 196.795 (6m)
21(a) 6.
AB389, s. 79 22Section 79. 196.795 (5) (pm) 2. of the statutes is renumbered 196.795 (6m) (c)
23and amended to read:
AB389,59,424 196.795 (6m) (c) Wholesale merchant plants. The assets of a wholesale
25merchant plant shall not be included in the sum of the assets of a public utility

1affiliate under par. (p) (b) 1. a., b. or c. and shall not be included in a nonutility
2affiliate's total assets under par. (p) (b) 2. a. if the requirements specified in s. 196.491
3(3m) (a) 1. and 2. are satisfied or if the wholesale merchant plant qualifies for the
4exemption under s. 196.491 (3m) (e).
AB389, s. 80 5Section 80. 196.795 (5) (pm) 3. of the statutes is renumbered 196.795 (6m) (d)
6and amended to read:
AB389,59,107 196.795 (6m) (d) Foreign affiliates. The assets of a foreign affiliate shall be
8included in the sum of the assets of a public utility affiliate under par. (p) (b) 1. a.,
9b. or c. and shall not be included in a nonutility affiliate's total assets under par. (p)
10(b) 2. a.
AB389, s. 81 11Section 81. 196.795 (6m) (title) of the statutes is created to read:
AB389,59,1212 196.795 (6m) (title) Asset cap.
AB389, s. 82 13Section 82. 196.795 (6m) (a) (intro.) of the statutes is created to read:
AB389,59,1414 196.795 (6m) (a) Definitions. (intro.) In this subsection:
AB389, s. 83 15Section 83. 196.795 (6m) (a) 1. of the statutes is created to read:
AB389,59,1816 196.795 (6m) (a) 1. "Contributor public utility affiliate" means a public utility
17affiliate that has contributed its transmission facilities to the transmission company
18under s. 196.485 (5) (b).
AB389, s. 84 19Section 84. 196.795 (6m) (a) 2. of the statutes is created to read:
AB389,59,2120 196.795 (6m) (a) 2. "Eligible asset" means an asset of a nonutility affiliate that
21is used for any of the following:
AB389,59,2322 a. Producing, generating, transmitting, delivering, selling or furnishing gas,
23oil, electricity or steam energy.
AB389,59,2524 b. Providing an energy management, conservation or efficiency product or
25service or a demand-side management product or service.
AB389,60,1
1c. Providing an energy customer service, including metering or billing.
AB389,60,22 d. Recovering or producing energy from waste materials.
AB389,60,33 e. Processing waste materials.
AB389,60,64 f. Manufacturing, distributing or selling products for filtration, pumping water
5or other fluids, processing or heating water, handling fluids or other related
6activities.
AB389,60,77 g. Providing a telecommunications service, as defined in s. 196.01 (9m).
AB389, s. 85 8Section 85. 196.795 (6m) (a) 4. of the statutes is created to read:
AB389,60,119 196.795 (6m) (a) 4. "Generation assets" means assets that are classified as
10electric generation assets on the books of account of a public utility, as determined
11by the commission.
AB389, s. 86 12Section 86. 196.795 (6m) (b) (title) of the statutes is created to read:
AB389,60,1313 196.795 (6m) (b) In general.
AB389, s. 87 14Section 87. 196.795 (6m) (e) of the statutes is created to read:
AB389,60,2015 196.795 (6m) (e) Contributor public utility affiliates. 1. The eligible assets of
16a nonutility affiliate in a holding company system that includes each of the
17contributor public utility affiliates in the holding company system shall not be
18included in the sum of the assets of the public utility affiliates under par. (b) 1. a.,
19b. or c. and shall not be included in the nonutility affiliate's total assets under par.
20(b) 2. a.
AB389,60,2221 2. For purposes of subd. 1., all of the assets of a nonutility affiliate shall be
22considered eligible assets if each of the following is satisfied:
AB389,60,2523 a. The bylaws of the nonutility affiliate or a resolution adopted by its board of
24directors specifies that the business of the nonutility affiliate is limited to activities
25involving eligible assets.
AB389,61,1
1b. Substantially all of the assets of the nonutility affiliate are eligible assets.
AB389,61,72 3. The net book value of transmission facility assets that a contributor public
3utility affiliate has contributed to a transmission company under s. 196.485 (5) (b)
4shall be included in the sum of the assets of the public utility affiliate under par. (b)
51. a., b. and c. In determining net book value under this subdivision, accumulated
6depreciation shall be calculated as if the contributor public utility affiliate had not
7contributed the assets.
AB389,61,148 4. The net book value of generation assets that a contributor public utility
9affiliate has transferred to a person that is not affiliated with the public utility
10affiliate pursuant to the order of the commission, a court or a federal regulatory
11agency shall be included in the sum of the assets of the public utility affiliate under
12par. (b) 1. a., b. and c. In determining net book value under this subdivision,
13accumulated depreciation shall be calculated as if the contributor public utility
14affiliate had not transferred the assets.
AB389, s. 88 15Section 88. 196.795 (11) (b) of the statutes is amended to read:
AB389,62,216 196.795 (11) (b) This section shall be deemed to legalize and confirm the
17formation, prior to November 28, 1985, of any holding company, which is not itself
18a public utility, and shall be deemed to legalize and confirm the operations and
19issuances of securities of the holding company, except that nothing in this section
20shall be deemed to prevent the commission from imposing reasonable terms,
21limitations or conditions on any holding company which are consistent with the
22requirements of sub. (5) (pm) (6m) (c) or (d) or which are consistent with and
23necessary to satisfy the requirements of sub. (5) (b) to (o) and (q) to (s) or which relate
24to future investments by the holding company unless the holding company owns,

1operates, manages or controls a telecommunications utility and does not also own,
2operate, manage or control a public utility which is not a telecommunications utility.
AB389, s. 89 3Section 89. 196.795 (11) (c) of the statutes is created to read:
AB389,62,124 196.795 (11) (c) The commission may not impose upon a holding company the
5formation of which is considered to be legalized and confirmed under par. (b) any
6term, limitation or condition under par. (b) that establishes the sum of the holding
7company's nonutility affiliate assets at less than 25% of the sum of the holding
8company's utility affiliate assets. For purposes of this paragraph, any term,
9limitation or condition on nonutility affiliate assets shall not apply to the ownership,
10operation, management or control of any eligible asset, as defined under sub. (6m)
11(a) 2., or an asset that is used for manufacturing, distributing or selling swimming
12pools or spas.
AB389, s. 90 13Section 90. 196.807 of the statutes is created to read:
AB389,62,15 14196.807 Energy affiliate and utility employes. (1) Definitions. In this
15section:
AB389,62,1716 (a) "Affiliate or utility" means a nonutility affiliate, a holding company system
17or an electric utility, as defined in s. 196.491 (1) (d).
AB389,62,2018 (b) "Energy unit" means a unit in this state that is engaged in activities related
19to the production, generation, transmission or distribution of electricity, gas or steam
20or the recovery of energy from waste materials.
AB389,62,2121 (c) "Holding company system" has the meaning given in s. 196.795 (1) (i).
AB389,62,2222 (d) "Nonutility affiliate" has the meaning given in s. 196.795 (1) (j).
AB389,62,2323 (e) "Public utility affiliate" has the meaning given in s. 196.795 (1) (L).
AB389,62,2524 (f) "Sell an energy unit" means to sell, offer by lease, or otherwise transfer
25ownership or control of the energy unit.
AB389,63,2
1(g) "Unit" means a division, department or other operational business unit of
2an affiliate or utility.
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