September/October 2016 Issue

Also in this issue: Employee Requests to Review Personnel Records: Responding Lawfully     |     Denial of Frac Sand Mining Permit Upheld by Appeals Court

Focus On Energy Faces Uncertain Future

Richard Heinemann | 08.30.16

Focus on Energy (“FOE”) is a statewide program that provides incentives and technical assistance to homes and businesses — including local governments — to reduce energy use and install customer-owned renewable energy. Since its inception in 1999 by act of state legislature, it has been widely viewed as a success story, providing over $750 million in economic benefits to the state, according to one independent evaluation by the Cadmus group.

Recently, however, funding for the program has come under pressure. The statutes require the state’s public utilities to spend 1.2% of their operating revenues to support the statewide program; municipal utilities and electric cooperatives can contribute additional funding at an average of $8 per meter or opt to fund their own energy efficiency programs. Governor Walker’s 2016 budget bill modified the support requirements by removing $7 million in operating revenues associated with non-retail sales, saving money for ratepayers, but reducing overall funding for the program. 

The Public Service Commission of Wisconsin (“PSCW”), which is charged with overseeing FOE, has yet to make budgetary decisions on allocations for renewable energy incentives in 2017 and 2018, so it remains unclear whether, or how much, money is available for renewable energy cash grants for businesses during the next two years. 

The PSCW has, however, stepped up funding on researching ways to make the program more effective. It also provided additional funding support for a 0% interest revolving loan program, launched in January, designed to help businesses (including municipalities) interested in pursuing solar installations. Unfortunately, less than 10% of that money has been committed to actual projects and little appetite for the loan program has been demonstrated. 

On September 1, the PSCW issued a surprise notice of investigation (PSCW Docket 5‑FE-102) into FOE funding mechanisms. The ostensible aim of the investigation is to explore how the program can be better utilized to serve rural areas. However, the notice makes clear that the PSCW will be considering the possibility of diverting FOE funds that are either currently unallocated, or that have been previously allocated but remain unspent or in reserve, to use for rural broadband development. Such diversion would further erode FOE funding support, notwithstanding the importance of addressing the issue of expanding broadband to underserved areas of Wisconsin. 

Numerous stakeholders have intervened in the proceeding, including all the state’s major utilities, consumer and environmental advocacy groups, and local governments that rely on FOE to support their own energy efficiency efforts and climate change goals. 

At a time when state budgetary pressures are mounting, one of Wisconsin’s most respected energy programs is proving vulnerable to attack. 

— Richard A. Heinemann