1997 Wisconsin Act 204

1. The public utility has transferred control over its transmission facilities, as defined in s. 196.485 (1) (h), to an independent system operator, as defined in s. 196.485 (1) (d), that is approved by the federal energy regulatory commission or the public utility has divested its interest in the transmission facilities to an independent transmission owner, as defined in s. 196.485 (1) (dm).

2. The commission finds that the ownership, control or operation will not have a substantial anticompetitive effect on electricity markets for any classes of customers.

(b) Duty to promulgate rules. 1. The commission shall promulgate rules that establish requirements and procedures for an affiliated interest to apply for an approval under par. (a). The rules shall do each of the following:

a. Describe the showing that an applicant is required to make for the commission to grant an approval under par. (a).

am. Establish screening tests and safe harbors for proposed wholesale merchant plant projects, including projects in which an affiliated interest is a passive investor and over which the affiliated interest is not able to exercise control or influence and projects in which an affiliated interest's ownership interest is less than 5%.

b. Describe the analytical process that the commission shall use in determining whether to make a finding under par. (a) 2. and describe the factors specified in subd. 3.

c. Allow an interested person to request a hearing on an application under s. 227.42.

2. The analytical process specified in subd. 1. b. shall, to the extent practicable, be consistent with the analytical process described in the enforcement policy of the federal department of justice and the federal trade commission regarding horizontal acquisitions and mergers that are subject to 15 USC 1, 18 or 45.

3. The commission shall use the following factors in determining whether to make a finding under par. (a) 2.:

a. The degree of market concentration resulting from the affiliated interest's proposed ownership, operation or control.

b. The extent of control that the affiliated interest proposes to exercise over the wholesale merchant plant.

d. Any other factor that the commission determines is necessary to determine whether to make a finding under par. (a) 2.

(c) Sales by affiliated interests. 1. In this paragraph:

a. “Electric sale" means a sale of electricity that is generated at a wholesale merchant plant that is owned, operated or controlled by an affiliated interest.

b. “Firm sale" means an electric sale in which electricity is intended to be available to a purchaser at all times during a specified period on an uninterruptible basis.

2. The commission shall review any electric sale by an affiliated interest to a public utility with which the affiliated interest is affiliated. If the commission finds that an electric sale is not in the public interest, the commission shall do any of the following:

a. Disallow the public utility's costs related to the sale in a rate-setting proceeding.

b. Order the public utility to provide a refund, in an amount determined by the commission, to its customers.

c. Order the public utility or affiliated interest to take any action that the commission determines is in the public interest, except that the commission may not order the public utility or affiliated interest to void the sale.

3. An affiliated interest may not make any firm sale to a public utility with which the affiliated interest is affiliated if the firm sale satisfies any of the following:

a. The period of the firm sale is 3 years or more.

b. The period of the firm sale is less than 3 years and either the public utility or the affiliated interest has an option to extend the period to 3 years or more.

(d) Retail sales outside this state. The commission may not promulgate rules or issue orders that prohibit owners or operators of wholesale merchant plants from providing electric service to retail customers in another state.

(e) Exemption. An approval under par. (a) is not required for an affiliated interest to own, operate or control a wholesale merchant plant in Grant County if the affiliated interest owned, operated or controlled the wholesale merchant plant before January 1, 1998.

204,82 Section 82 . 196.491 (4) (a) (intro.) of the statutes, as created by 1997 Wisconsin Act 27, is repealed.

204,83 Section 83 . 196.491 (4) (a) 1. and 2. of the statutes, as created by 1997 Wisconsin Act 27, are renumbered 196.491 (4) (b) 1. and 2.

204,84 Section 84 . 196.491 (4) (a) 3. of the statutes, as created by 1997 Wisconsin Act 27, is repealed.

204,85 Section 85 . 196.491 (4) (b) of the statutes, as created by 1997 Wisconsin Act 27, is renumbered 196.491 (4) (b) (intro.) and amended to read:

196.491 (4) (b) (intro.) Subsection (3) does not apply to a person that constructs electric generating equipment and associated facilities if the person satisfies the requirements specified in par. (a) 1. and 2. each of the following:

204,86 Section 86 . 196.491 (4) (c) of the statutes is created to read:

196.491 (4) (c) A certificate under sub. (3) is not required for a person to construct a high-voltage transmission line designed for operation at a nominal voltage of less than 230 kilovolts if all related construction activity takes place entirely within the area of an existing electric transmission line right-of-way.

204,87 Section 87 . 196.491 (5) of the statutes is created to read:

196.491 (5) Service standards for electric generation, transmission and distribution facilities. The commission shall promulgate rules that establish all of the following:

(a) Standards for inspecting, maintaining and repairing each of the following:

1. Electric generation facilities in this state that are owned by public utilities or provide service to public utilities under contracts with terms of 5 years or more.

2. Electric transmission or distribution facilities in this state that are owned by public utilities.

(b) Standards that the commission determines are necessary for the safe and reliable operation of each of the following:

1. Electric generation facilities in this state that are owned by public utilities or provide service to public utilities under contracts with terms of 5 years or more.

2. Electric transmission or distribution facilities in this state that are owned by public utilities.

204,88 Section 88 . 196.492 of the statutes is repealed.

204,89 Section 89 . 196.493 (1) of the statutes is amended to read:

196.493 (1) Definition. In this section, “nuclear power plant" means a nuclear-fired large electric generating facility as defined under s. 196.491 (1) (g) or a nuclear-fired bulk electric generating facility as defined under s. 196.491 (1) (a).

204,90 Section 90 . 196.493 (2) (intro.) of the statutes is amended to read:

196.493 (2) Limits on certification. (intro.) The commission may not certify under s. 196.49 (3) (b) or 196.491 (3) any nuclear power plant and may not approve under s. 196.491 (2) any plan which includes a nuclear power plant unless the commission finds that:

204,91 Section 91 . 196.494 of the statutes is created to read:

196.494 Regional transmission planning. (1) In this section:

(a) “Electric utility" means a public utility, other than a municipal utility, as defined in s. 196.377 (2) (a) 3., that provides retail electric service to customers in this state.

(b) “Transmission facility" means any pipe, pipeline, duct, wire, line, conduit, pole, tower, equipment or other structure used for the transmission of electric power as determined by the commission.

(2) The commission shall conduct a study on identifying and relieving any constraint on an intrastate or interstate electric transmission system that adversely affects the reliability of transmission service provided to electric customers in this state and shall, no later than September 1, 1998, submit a report on the results of the study to the legislature in the manner provided under s. 13.172 (2).

(3) No later than December 31, 2004, the commission may, under this subsection, issue an order requiring an electric utility to construct or procure, on a competitive basis, the construction of transmission facilities specified by the commission in its order if the commission determines that, based on the results of the study under sub. (2), such construction is necessary to relieve a constraint on a transmission system and the construction will materially benefit the customers of the electric utility or other electric utilities or of an independent system operator, as defined in s. 196.485 (1) (d), or independent transmission owner, as defined in s. 196.485 (1) (dm).

(4) The commission shall allow an electric utility to recover in its retail electric rates any costs that are prudently incurred by the utility in complying with an order under sub. (3).

204,92 Section 92 . 196.53 of the statutes is amended to read:

196.53 Franchise, foreign corporation not to have. No license, permit or franchise to own, operate, manage or control any plant or equipment for the production, transmission, delivery or furnishing of heat, light, water or power may be granted or transferred to a foreign corporation. This section does not apply to an independent system operator, as defined in s. 196.485 (1) (d), or an independent transmission owner, as defined in s. 196.485 (1) (dm), that is approved by the applicable federal agency, as defined in s. 196.485 (1) (c), and that controls transmission facilities, as defined in s. 196.485 (1) (h), in this and another state.

204,93 Section 93 . 196.795 (5) (pm) of the statutes is created to read:

196.795 (5) (pm) 1. In this paragraph:

a. “Foreign affiliate" means a person that is engaged in the production, transmission, delivery or furnishing of heat, light, power or natural gas either directly or indirectly to or for use of the public in another state, that is incorporated under the laws of another state, that is an affiliated interest, as defined in s. 196.52 (1), of a public utility and that is operated on an integrated system basis, as determined by the commission, with the public utility.

b. “Reliability council area" means the geographic area that, on December 31, 1997, was served by the Mid-America Interconnected Network, Inc., Mid-Continent Area Power Pool, East Central Area Reliability Coordination Agreement or Southwest Power Pool reliability council of the North American Electric Reliability Council.

c. “Wholesale merchant plant" means a wholesale merchant plant, as defined in s. 196.491 (1) (w), except that its location is not limited to this state, that is located in the reliability council area and that is owned, operated or controlled by an affiliated interest of a public utility.

2. The assets of a wholesale merchant plant shall not be included in the sum of the assets of a public utility affiliate under par. (p) 1. a., b. or c. and shall not be included in a nonutility affiliate's total assets under par. (p) 2. a. if the requirements specified in s. 196.491 (3m) (a) 1. and 2. are satisfied or if the wholesale merchant plant qualifies for the exemption under s. 196.491 (3m) (e).

3. The assets of a foreign affiliate shall be included in the sum of the assets of a public utility affiliate under par. (p) 1. a., b. or c. and shall not be included in a nonutility affiliate's total assets under par. (p) 2. a.

204,94 Section 94 . 196.795 (7) (a) 1. b. of the statutes is amended to read:

196.795 (7) (a) 1. b. Any public utility or member of a cooperative association organized under ch. 185 which files or has filed a plan under reports or has reported information to the commission under the rules promulgated under s. 196.491 (2) (ag).

204,94m Section 94m. 196.795 (11) (b) of the statutes is amended to read:

196.795 (11) (b) This section shall be deemed to legalize and confirm the formation, prior to November 28, 1985, of any holding company, which is not itself a public utility, and shall be deemed to legalize and confirm the operations and issuances of securities of the holding company, except that nothing in this section shall be deemed to prevent the commission from imposing reasonable terms, limitations or conditions on any holding company which are consistent with the requirements of sub. (5) (pm) or which are consistent with and necessary to satisfy the requirements of sub. (5) (b) to (o) and (q) to (s) or which relate to future investments by the holding company unless the holding company owns, operates, manages or controls a telecommunications utility and does not also own, operate, manage or control a public utility which is not a telecommunications utility.

204,95 Section 95 . 289.29 (5) of the statutes is amended to read:

289.29 (5) Issuance of final determination of feasibility in certain situations involving utilities and mining. If a determination of feasibility is required under s. 196.491 (2m) identified in the listing specified in s. 196.491 (3) (a) 3. a., the issuance of a final determination of feasibility is subject to the time limits limit under s. 196.491 (3) (f) and (ff) (a) 3. b. If a determination of feasibility is required under s. 293.43, the issuance of a final determination of feasibility is subject to the time limits under s. 293.45 (2) or 293.49, whichever is applicable.

204,96 Section 96 . Nonstatutory provisions.

(1) Requests for proposals for electric generation capacity.

(a) In this subsection:

1. “Certificate" means a certificate issued by the commission under section 196.49 of the statutes or under section 196.491 (3) of the statutes, as affected by this act.

2. “Commission" means the public service commission.

3. “Contractor" means a person specified in paragraph (b) 3 . that enters into a contract with an eastern Wisconsin utility for the construction of electric generation capacity.

4. “Department" means the department of natural resources.

5. “Eastern Wisconsin utility" has the meaning given in section 196.377 (2) (a) 1. of the statutes, as created by this act.

6. “Reliability council" has the meaning given in section 196.377 (2) (a) 4. of the statutes, as created by this act.

(b) By July 31, 1998, or a later date approved by the commission, each eastern Wisconsin utility that, before the effective date of this paragraph, has issued a request for proposals soliciting bids for contracts for the construction of new electric generation capacity shall do each of the following:

1. Complete its evaluation of the bids that were submitted in response to the request for proposals.

2. Select the bids for which it intends to award the contracts.

3. Enter into contracts with the persons who submitted the bids specified in subdivision 2 . for the construction of the new electric generation capacity.

(c) Notwithstanding section 196.491 (3) (a) 1. of the statutes, as affected by this act, no later than August 31, 1998, each eastern Wisconsin utility specified in paragraph (b) (intro.) shall apply to the commission for any certificate that is required for construction of new electric generation capacity under the contracts into which it enters under paragraph (b) 3. and, if required under section 196.491 (3) (a) 3. a. of the statutes, as affected by this act, submit an engineering plan to the department as specified in section 196.491 (3) (a) 3. a. of the statutes, as affected by this act.

(d) Notwithstanding section 196.491 (3) (a) 3. a. and b. of the statutes, as affected by this act, if an eastern Wisconsin utility specified in paragraph (b ) (intro.) submits an engineering plan to the department under paragraph (c), the eastern Wisconsin utility and the department shall satisfy each of the following:

1. Within 15 days after the eastern Wisconsin utility provides the engineering plan, the department shall provide the eastern Wisconsin utility with a listing of each department permit or approval which, on the basis of the information contained in the engineering plan, appears to be required for the construction or operation of the facility.

2. Within 10 days after the department provides a listing specified in subdivision 1., the eastern Wisconsin utility shall apply for the permits and approvals identified in the listing.

3. The department shall determine whether an application under subdivision 2. is complete and, no later than 15 days after the application is filed, notify the applicant about the determination. If the department determines that the application is incomplete, the notice shall state the reason for the determination. An eastern Wisconsin utility may supplement and refile an application that the department has determined to be incomplete. There is no limit on the number of times that an applicant may refile an application under this subdivision. If the department fails to determine whether an application is complete within 15 days after the application is filed, the application shall be considered to be complete.

4. The department shall complete action on an application submitted under subdivision 2 . or refiled under subdivision 3. within 45 days after the date on which the application is determined or considered to be complete under subdivision 3.

(e) Notwithstanding section 196.491 (3) (a) 2., (b) and (g) 1. and 2. of the statutes, as affected by this act, the commission and an eastern Wisconsin utility specified in paragraph (b) (intro.) that applies for a certificate under section 196.491 (3) of the statutes, as affected by this act, shall satisfy each of the following:

1. The commission shall determine whether the application is complete and, no later than 15 days after the application is filed, notify the applicant about the determination. If the commission determines that the application is incomplete, the notice shall state the reason for the determination. An eastern Wisconsin utility may supplement and refile an application that the commission has determined to be incomplete. There is no limit on the number of times that an eastern Wisconsin utility may refile an application under this subdivision. If the commission fails to determine whether an application is complete within 15 days after the application is filed, the application shall be considered to be complete.

2. The commission shall hold a public hearing on an application that is determined or considered to be complete under subdivision 1. in the area affected pursuant to section 227.44 of the statutes and, at least 15 days prior to the hearing, shall give a class 1 notice regarding the hearing under chapter 985 of the statutes.

3. The commission shall take final action on the application within 90 days after the application is determined or considered to be complete under subdivision 1 . If the commission fails to take final action within the 90-day period, the commission is considered to have issued a certificate with respect to the application.