Menu

196.027(2) (2) Financing orders.

196.027(2)(a) (a) Applications. An energy utility may apply to the commission for a financing order. In addition to any other information required by the commission, an energy utility shall do all of the following in an application:

196.027(2)(a)1. 1. Describe the environmental control activities that the energy utility proposes to undertake, indicate whether the energy utility’s electric, natural gas, or steam service is associated with the activities, and describe the reasons for undertaking the activities.

196.027(2)(a)2. 2. Estimate the environmental control costs of the activities described under subd. 1.

196.027(2)(a)3. 3. Indicate whether the energy utility proposes to finance all or a portion of the costs estimated under subd. 2. with environmental trust bonds. If the energy utility proposes to finance a portion of the costs, the energy utility shall identify that portion in the application.

196.027(2)(a)4. 4. Estimate the financing costs of the environmental trust bonds proposed under subd. 3.

196.027(2)(a)5. 5. Estimate the environmental control charges necessary to recover the environmental control costs and financing costs estimated in the application and indicate whether the environmental control charges are proposed for the energy utility’s electric, natural gas, or steam service.

196.027(2)(a)6. 6. Estimate any cost savings to customers resulting from financing environmental control costs with environmental trust bonds as opposed to alternative financing methods.

196.027(2)(b) (b) Commission powers and duties.

196.027(2)(b)1. 1. No later than 120 days after receiving an application under par. (a), the commission shall, after a hearing, issue a financing order or an order rejecting the application. The commission may issue a financing order if the commission finds all of the following:

196.027(2)(b)1.a. a. That the order will result in lower overall costs to customers than would alternative methods of financing environmental control activities.

196.027(2)(b)1.b. b. That the proposed structuring and expected pricing of the environmental trust bonds will result in the lowest environmental control charges that are consistent with market conditions and the terms of the financing order.

196.027(2)(b)1.c. c. That the financing order is otherwise consistent with the public interest, and is prudent, reasonable, and appropriate.

196.027(2)(b)2. 2. In a financing order issued to an energy utility, the commission shall do all of the following:

196.027(2)(b)2.a. a. Except as provided in subds. 2. c. and 4., specify the amount of environmental control costs and financing costs that may be recovered through environmental control charges and the period over which such costs may be recovered.

196.027(2)(b)2.b. b. For the period specified in subd. 2. a. require that, as long as any customer obtains distribution service from the energy utility or its successors, the customer shall pay environmental control charges to the energy utility or its assignees regardless of whether the customer obtains other service from a different energy utility or other energy supplier.

196.027(2)(b)2.c. c. Include a formula-based mechanism for making any adjustments in the environmental control charges that customers are required to pay under the order and making any adjustments that are necessary to correct for any overcollection or undercollection of the charges or to otherwise ensure the energy utility’s or assignee’s timely recovery of environmental control costs and financing costs.

196.027(2)(b)2.d. d. Specify the environmental control property that is created and that may be used to pay or secure environmental trust bonds.

196.027(2)(b)2.e. e. If considered appropriate by the commission, include a provision allowing for the retirement of environmental trust bonds before their termination dates.

196.027(2)(b)2.f. f. Include any other conditions that the commission considers appropriate and that are not otherwise inconsistent with this section.

196.027(2)(b)3. 3. A financing order issued to an energy utility may provide that the energy utility’s acquisition of environmental control property specified in subd. 2. d. is conditioned upon, and shall be simultaneous with, the sale of the environmental control property to an assignee and the pledge of the environmental control property to secure environmental trust bonds.

196.027(2)(b)4. 4.

196.027(2)(b)4.a. a. If the commission issues a financing order, the commission shall apply, at least annually, the formula-based mechanism specified in subd. 2. c. and, based on estimates of demand and other mathematical factors, make the adjustments described in subd. 2. c. The commission shall make the adjustments within 45 days of the anniversary date on which environmental trust bonds are issued and after expiration of the comment period described in subd. 4. b.

196.027(2)(b)4.b. b. The commission may not hold a hearing for the purpose of making an adjustment under subd. 4. a., but shall allow interested parties 30 days to make comments limited to any error in the application of the formula-based mechanism relating to the appropriate amount of any overcollection or undercollection of environmental control charges and the appropriate amount of an adjustment.

196.027(2)(b)5. 5. A financing order is irrevocable and, except as provided in subds. 2. c. and 4., the commission may not reduce, impair, or otherwise adjust environmental control charges approved in the order.

196.027(2)(c) (c) Subsequent orders. The commission may commence a proceeding and issue a subsequent financing order that provides for retiring or refunding environmental trust bonds issued pursuant to the original financing order if the commission included a provision described in par. (b) 2. e. in the original financing order and if the commission finds that the subsequent financing order satisfies all of the criteria specified in par. (b) 1. a., b., and c.

196.027(2)(d) (d) Judicial review. A financing order or an order rejecting an application under par. (b) 1. is reviewable by the circuit court for Dane County under ch. 227, except that the court shall proceed to hear and determine the action as expeditiously as practicable and give the action precedence over other matters not accorded similar precedence by law.

196.027(2)(e) (e) Effect of orders.

196.027(2)(e)1. 1. A financing order shall remain in effect until the environmental trust bonds issued pursuant to the order have been paid in full and the financing costs of the bonds have been recovered in full.

196.027(2)(e)2. 2. A financing order issued to an energy utility shall remain in effect and unabated notwithstanding the bankruptcy of the energy utility.

196.027(2)(e)3. 3. An application by an energy utility for a financing order and commission approval of a financing order are in addition to and do not replace or supersede any other review or approval by the commission under this chapter that may be required or allowed for environmental control activities.