(title) Coordination with department of natural resources.
(title) Reliability reports.
(title) Small-scale generation incentives.
(title) Market power study.
16196.374 Energy efficiency and renewable resource programs. (1) 17Definitions.
In this section:
(a) "Agricultural producer" means a person engaged in an agricultural activity, 19
as defined in s. 101.10 (1) (a).
(b) "Commitment to community program" means an energy efficiency or load 21
management program by or on behalf of a municipal utility or retail electric 22
(c) "Customer application of renewable resources" means the generation of 24
energy from renewable resources that takes place on the premises of a customer of 25
an energy utility or municipal utility or a member of a retail electric cooperative.
(d) "Energy efficiency program" means a program for reducing the usage or 2
increasing the efficiency of the usage of energy by a customer or member of an energy 3
utility, municipal utility, or retail electric cooperative. "Energy efficiency program" 4
does not include load management.
(e) "Energy utility" means an investor-owned electric or natural gas public 6
(em) "Large energy customer" means a customer of an energy utility that owns 8
or operates a facility in the energy utility's service area that has an energy demand 9
of at least 1,000 kilowatts of electricity per month or of at least 10,000 decatherms 10
of natural gas per month and that, in a month, is billed at least $60,000 for electric 11
service, natural gas service, or both, for all of the facilities of the customer within the 12
energy utility's service territory.
(f) "Load management program" means a program to allow an energy utility, 14
municipal utility, wholesale electric cooperative, as defined in s. 16.957 (1) (v), retail 15
electric cooperative, or municipal electric company, as defined in s. 66.0825 (3) (d), 16
to control or manage daily or seasonal customer demand associated with equipment 17
or devices used by customers or members.
(g) "Local unit of government" has the meaning given in s. 23.24 (4) (a) 1.
(h) "Municipal utility" has the meaning given in s. 16.957 (1) (q).
(i) "Ordered program" means an energy efficiency or renewable resource 21
program that an energy utility commenced on or after January 1, 2001, under a 22
commission order issued on or after January 1, 2001, and in effect before the effective 23
date of this paragraph .... [revisor inserts date].
(j) "Renewable resource" means a resource that derives energy from any source 25
other than coal, petroleum products, nuclear power or, except as used in a fuel cell,
natural gas. "Renewable resource" includes resources deriving energy from any of 2
5. Geothermal technology.
6. Tidal or wave action.
7. Fuel cell technology that uses, as determined by the commission, a renewable 10
(k) "Renewable resource program" means a program for encouraging the 12
development or use of customer applications of renewable resources, including 13
educating customers or members about renewable resources, encouraging 14
customers or members to use renewable resources, and encouraging the transfer of 15
new or emerging technologies from research, development, and demonstration to 16
(L) "Retail electric cooperative" has the meaning given in s. 16.957 (1) (t).
(n) "Wholesale supplier" has the meaning given in s. 16.957 (1) (w).
(o) "Wholesale supply percentage" has the meaning given in s. 16.957 (1) (x).
20(2) Energy efficiency and renewable resource programs.
1. The energy utilities in this state shall collectively establish and fund 22
statewide energy efficiency and renewable resource programs. The energy utilities 23
shall contract, on the basis of competitive bids, with one or more persons to develop 24
and administer the programs. The utilities may not execute a contract under this 25
subdivision unless the commission has approved the contract. The commission shall
require each energy utility to spend the amount required under sub. (3) (b) 2. to fund 2
statewide energy efficiency and renewable resource programs.
2. The purpose of the programs under this paragraph shall be to help achieve 4
environmentally sound and adequate energy supplies at reasonable cost, consistent 5
with the commission's responsibilities under s. 196.025 (1) (ar) and the utilities' 6
obligations under this chapter. The programs shall include, at a minimum, all of the 7
a. Components to address the energy needs of residential, commercial, 9
agricultural, institutional, and industrial energy users and local units of 10
b. Components to reduce the energy costs incurred by local units of government 12
and agricultural producers, by increasing the efficiency of energy use by local units 13
of government and agricultural producers. The commission shall ensure that not 14
less than 10 percent of the moneys utilities are required to spend under subd. 1. or 15
sub. (3) (b) 2. is spent annually on programs under this subdivision except that, if the 16
commission determines that the full amount cannot be spent on cost-effective 17
programs for local units of government and agricultural producers, the commission 18
shall ensure that any surplus funds be spent on programs to serve commercial, 19
institutional, and industrial customers. A local unit of government that receives 20
assistance under this subd. 2. b. shall apply all costs savings realized from the 21
assistance to reducing the property tax levy.
c. Initiatives and market strategies that address the needs of individuals or 23
businesses facing the most significant barriers to creation of or participation in 24
markets for energy efficient products that the individual or business manufactures 25
or sells or energy efficiency services that the individual or business provides.
d. Initiatives for research and development regarding the environmental and 2
economic impacts of energy use in this state.
3. The commission may not require an energy utility to administer or fund any 4
energy efficiency or renewable resource program that is in addition to the programs 5
required under subd. 1. and any ordered program of the utility. This subdivision does 6
not limit the authority of the commission to enforce an energy utility's obligations 7
under s. 196.378.
(b) Utility-administered programs.
1. An energy utility may, with commission 9
approval, administer or fund one or more energy efficiency programs that is limited 10
to, as determined by the commission, large commercial, industrial, institutional, or 11
agricultural customers in its service territory. An energy utility shall pay for a 12
program under this subdivision with a portion of the amount required under sub. (3) 13
(b) 2., as approved by the commission. The commission may not order an energy 14
utility to administer or fund a program under this subdivision.
2. An energy utility may, with commission approval, administer or fund an 16
energy efficiency or renewable resource program that is in addition to the programs 17
required under par. (a) or authorized under subd. 1. The commission may not order 18
an energy utility to administer or fund a program under this subdivision.
3. An energy utility that administers or funds a program under subd. 1. or 2. 20
or an ordered program may request, and the commission may approve, to modify or 21
discontinue, in whole or in part, the ordered program. An energy utility may request 22
the establishment, modification, or discontinuation of a program under subd. 1. or 23
2. at any time and shall request the modification or discontinuation of an ordered 24
program as part of a proceeding under sub. (3) (b) 1.
(c) Large energy customer programs.
A customer of an energy utility may, with 2
commission approval, administer and fund its own energy efficiency programs if the 3
customer satisfies the definition of a large energy customer for any month in the 12 4
months preceding the date of the customer's request for approval. A customer may 5
request commission approval at any time. A customer that funds a program under 6
this paragraph may deduct the amount of the funding from the amount the energy 7
utility may collect from the customer under sub. (5) (b). If the customer deducts the 8
amount of the funding from the amount the energy utility may collect from the 9
customer under sub. (5) (b), the energy utility shall credit the amount of the funding 10
against the amount the energy utility is required to spend under sub. (3) (b) 2.
11(3) Commission duties.
(a) In general.
The commission shall have oversight 12
of programs under sub. (2). The commission shall maximize coordination of program 13
delivery, including coordination between programs under subs. (2) (a) 1., (b) 1. and 14
2., and (c) and (7), ordered programs, low-income weatherization programs under s. 15
16.957, renewable resource programs under s. 196.378, and other energy efficiency 16
or renewable resource programs. The commission shall cooperate with the 17
department of natural resources to ensure coordination of energy efficiency and 18
renewable resource programs with air quality programs and to maximize and 19
document the air quality improvement benefits that can be realized from energy 20
efficiency and renewable resource programs.
(b) Programs and funding.
1. At least every 4 years, after notice and 22
opportunity to be heard, the commission shall, by order, evaluate the energy 23
efficiency and renewable resource programs under sub. (2) (a) 1., (b) 1. and 2., and 24
(c) and ordered programs and set or revise goals, priorities, and measurable targets 25
for the programs. The commission shall give priority to programs that moderate the
growth in electric and natural gas demand and usage, facilitate markets and assist 2
market providers to achieve higher levels of energy efficiency, promote energy 3
reliability and adequacy, avoid adverse environmental impacts from the use of 4
energy, and promote rural economic development.
2. The commission shall require each energy utility to spend 1.2 percent of its 6
annual operating revenues to fund the utility's programs under sub. (2) (b) 1., the 7
utility's ordered programs, and the utility's share of the statewide energy efficiency 8
and renewable resource programs under sub. (2) (a) 1. Subject to approval under 9
subd. 3., the commission may require each energy utility to spend a larger percentage 10
of its annual operating revenues to fund these programs. The commission may make 11
such a requirement based on the commission's consideration of all of the following:
a. Studies of potential energy-efficiency improvements that could be made in 13
this state, including at least one study completed within the preceding 2 years that 14
provides a prospective 5-year and 10-year estimate of such potential that is 15
b. The potential short-term and long-term impacts on electric and natural gas 17
rates and alternative means to mitigate such impacts.
c. The impact on the continuation and effectiveness of existing energy efficiency 19
and renewable resource programs, and the ability of such programs to capture 20
time-limited and cost-effective energy-efficiency opportunities.
d. The impact on the reliability and adequacy of systems for the generation and 22
transmission of electricity and the transmission of natural gas.
e. Societal impacts.
f. The potential for displacing or delaying construction of electric generating 25
plants and transmission lines.
g. Economic impacts that are likely to accrue from reducing state and private 2
expenditures on coal, natural gas, fuel oil, and other fossil fuel imports.
h. Any other relevant factors.
3. The commission shall submit to the joint committee on finance any proposal 5
to require each energy utility to spend a larger percentage of its annual operating 6
revenues than the percentage specified in subd. 2. (intro.) to fund the programs 7
specified in subd. 2. (intro.). If the cochairpersons of the committee do not notify the 8
commission within 10 working days after the commission submits such a proposal 9
that the committee has scheduled a meeting to review the proposal, the commission 10
may require each energy utility to spend the percentage specified in the proposal. 11
If, within 10 working days after the commission submits a proposal, the 12
cochairpersons of the committee notify the commission that the committee has 13
scheduled a meeting to review the proposal, but, within 90 days of providing the 14
notice, the committee does not object to the proposal, the commission may require 15
each energy utility to spend the percentage specified in the proposal. If, within 90 16
days after providing the notice, the committee objects to the proposal, the 17
commission may not require each energy utility to spend the percentage specified in 18
(c) Reviews and approvals.
The commission shall do all of the following:
1. Review and approve contracts under sub. (2) (a) 1. between the energy 21
utilities and program administrators.
2. Review requests under sub. (2) (b). The commission may condition its 23
approval of a request under sub. (2) (b) as necessary to protect the public interest. 24
The commission shall approve a request under sub. (2) (b) 1. or 2. if the commission
determines that a proposed energy efficiency or renewable resource program is in the 2
public interest and satisfies all of the following:
a. The program has specific savings targets and performance goals approved 4
by the commission.
b. The program is subject to independent evaluation by the commission.
Annually, the commission shall contract with one or more 7
independent auditors to prepare a financial and performance audit of the programs 8
specified in par. (b) 1. The purpose of the performance audit shall be to evaluate the 9
programs and measure the performance of the programs against the goals and 10
targets set by the commission under par. (b) 1. The person or persons with whom the 11
energy utilities contract for program administration under sub. (2) (a) 1. shall pay 12
the costs of the audits from the amounts paid under the contracts under sub. (2) (a) 13
Annually, the commission shall prepare and post on the 15
commission's Internet site a report and submit a summary of not more than 2 pages 16
to the legislature under s. 13.172 (2). The reports shall describe each of the following:
1. The expenses of the commission, utilities, and program administrators 18
contracted under sub. (2) (a) 1. in administering or participating in the programs 19
under sub. (2) (a) 1.
2. The effectiveness of the programs specified in par. (b) 1. and sub. (7) in 21
reducing demand for electricity and increasing the use of renewable resources owned 22
by customers or members.
3. The results of audits under par. (d).
4. Any other information required by the commission.
The commission shall promulgate rules to establish all of the 2
1. Procedures for energy utilities to collectively contract with program 4
administrators for administration of statewide programs under sub. (2) (a) 1. and to 5
receive contributions from municipal utilities and retail electric cooperatives under 6
sub. (7) (b) 2.
2. Procedures and criteria for commission review and approval of contracts for 8
administration of statewide programs under sub. (2) (a) 1., including criteria for the 9
selection of program administrators under sub. (2) (a) 1.
3. Procedures and criteria for commission review and approval of 11
utility-administered programs under sub. (2) (b) 1. and 2., customer programs under 12
sub. (2) (c), and requests under sub. (2) (b) 3.
4. Minimum requirements for energy efficiency and renewable resource 14
programs under sub. (2) (a) 1. and customer energy efficiency programs under sub. 15
16(4) Discrimination prohibited; competition.
(a) In implementing programs 17
under sub. (2) (a) 1., including the awarding of grants or contracts, a person who 18
contracts with the utilities under sub. (2) (a) 1., or a person who subcontracts with 19
such a person:
1. May not discriminate against an energy utility or its affiliate or a wholesale 21
supplier or its affiliate solely on the basis of its status as an energy utility or its 22
affiliate or wholesale supplier or its affiliate.
2. Shall provide services to utility customers on a nondiscriminatory basis and 24
subject to a customer's choice.
(b) An energy utility that provides financing under an energy efficiency 2
program under sub. (2) (b) 1. or 2. for installation, by a customer, of energy efficiency 3
or renewable resource processes, equipment, or appliances, or an affiliate of such a 4
utility, may not sell to or install for the customer those processes, equipment, 5
appliances, or related materials. The customer shall acquire the installation of the 6
processes, equipment, appliances, or related materials from an independent 7
contractor of the customer's choice.
8(5) Cost recovery.
(a) Rate-making orders.
The commission shall ensure in 9
rate-making orders that an energy utility recovers from its ratepayers the amounts 10
the energy utility spends for programs under sub. (2) (a) 1.
(b) Large energy customers.
1. Except as provided in sub. (2) (c) and par. (bm) 12
2., if the commission has determined that a customer of an energy utility is a large 13
energy customer under 2005 Wisconsin Act .... (this act), section 102 (8) (b), then, 14
each month, the energy utility shall collect from the customer, for recovery of 15
amounts under par. (a), the amount determined by the commission under 2005 16
Wisconsin Act .... (this act), section 102 (8) (c).
2. A customer of an energy utility that the commission has not determined is 18
a large energy customer under 2005 Wisconsin Act .... (this act), section 102 (8) (b), 19
may petition the commission for a determination that the customer is a large energy 20
customer. The commission shall determine that a petitioner is a large energy 21
customer if the petitioner satisfies the definition of large energy customer for any 22
month in the 12 months preceding the date of the petition. If the commission makes 23
such a determination, the commission shall also determine the amount that the 24
energy utility may collect from the customer each month for recovery of the amounts 25
under par. (a). The commission shall determine an amount that ensures that the
amount collected from the customer is similar to the amounts collected from other 2
customers that have a similar level of energy costs as the customer. Except as 3
provided in sub. (2) (c) and par. (bm) 2., each month, the energy utility shall collect 4
from the customer, for recovery of amounts under par. (a), the amount determined 5
by the commission under this subdivision.
(bm) Allocation proposal.
1. The commission shall commence a proceeding for 7
for creating a proposal for allocating within different classes of customers an 8
equitable distribution of the recovery of the amounts under par. (a) by all energy 9
utilities. The purpose of the allocation is to ensure that customers of an energy utility 10
within a particular class are treated equitably with respect to customers of other 11
energy utilities within the same class. No later than December 31, 2008, the 12
commission shall submit the proposal to the governor and chief clerk of each house 13
of the legislature for distribution to the appropriate standing committees of the 14
legislature under s. 13.172 (3).
2. If, by July 1, 2009, legislation based on the proposal under subd. 1. has not 16
been enacted, the commission shall, beginning on July 1, 2009, annually increase the 17
amount that an energy utility may recover from a large energy customer each month 18
under par. (b) only by a percentage that is the lesser of the following:
a. The percentage increase in the energy utility's operating revenues during the 20
b. The percentage increase in the consumer price index for all urban 22
consumers, U.S. city average, as determined by the U.S. department of labor, during 23
the preceding year.
The commission may prescribe the accounting treatment of 2
energy utility expenditures required under this section, including the use of any 3
(d) Equitable contributions.
Subject to pars. (b) and (bm) 2., the commission 5
shall ensure that the cost of energy efficiency and renewable resource programs is 6
equitably divided among customer classes so that similarly situated ratepayers 7
contribute equivalent amounts for the programs.
8(5m) Benefit and grant opportunities.
(a) The commission shall ensure that, 9
on an annual basis, each customer class of an energy utility has the opportunity to 10
receive grants and benefits under energy efficiency programs in an amount equal to 11
the amount that is recovered from the customer class under sub. (5) (a). Biennially, 12
the commission shall submit a report to the governor, and the chief clerk of each 13
house of the legislature for distribution to the legislature under s. 13.172 (2), that 14
summarizes the total amount recovered from each customer class and the total 15
amount of grants made to, and benefits received by, each customer class.
(b) The commission shall ensure that customers throughout the state have an 17
equivalent opportunity to receive the benefits of the programs under sub. (2) (a) 1. 18
and (b) 1. The commission shall ensure that statewide programs are designed to 19
ensure that retail customers in areas not served by programs under sub. (2) (b) 1. 20
receive equivalent opportunities as those in areas served by programs under sub. (2) 21
22(6) Annual statements.
Annually, the commission shall prepare a statement 23
that describes the programs under sub. (2) (a) 1., (b) 1. and 2., and (c), and ordered 24
programs, administered or funded by the energy utility and presents cost and benefit
information for those programs. An energy utility shall provide each of its customers 2
with a copy of the statement.
3(7) Municipal utilities and retail electric cooperatives.
(a) Requirement to
1. Each retail electric cooperative and municipal utility shall charge a 5
monthly fee to each customer or member in an amount that is sufficient for the retail 6
electric cooperative or municipal utility to collect an annual average of $8 per meter. 7
A retail electric cooperative or municipal utility may determine the amount that a 8
particular class of customers or members is required to pay under this subdivision 9
and may charge different fees to different classes of customers or members.
2. Notwithstanding subd. 1., in any month, the monthly fee under subd. 1. may 11
not exceed 1.5 percent of the total of every other charge for which the member or 12
customer is billed for that month or $375 per month, whichever is less.