We Energies is canceling a program that funded small-scale renewable energy development, including projects that resulted in solar power being generated at GE Healthcare and smaller projects at churches and nonprofits such as the Urban Ecology Center.
The utility announced on its website Friday that it has decided to terminate its Renewable Energy Development programs.
The utility had committed in 2002 to spending $6 million a year on renewable energy development initiatives but has decided to end that program, utility spokesman Brian Manthey said.
The company is no longer offering grants for nonprofits and will continue education and training programs “until committed funds are depleted,” the utility’s message said.
The announcement came weeks after the company reported record quarterly earnings and the same month that the utility plans to file a plan to increase rates for its electricity customers next year. The utility’s customers have seen bills rise by more than 5% this year, with a typical residential customer now paying $105 a month for electricity.
The power company said its decision is based on its increased investment in building renewable energy projects to meet the state’s 10% renewable energy target. Total spending in renewable energy, including two large wind farms and a portion of its investment in a $255 million biomass power plant in north-central Wisconsin, will exceed $800 million by the end of this year, Manthey said.
“There’s an awful lot going from customers to pay for renewable energy both for the projects as well as funds for the Focus on Energy program,” he said.
Focus on Energy is a statewide initiative funded by utility ratepayers that provides incentives for energy efficiency and renewable energy.
The utility’s $800 million estimate includes $120 million that would be spent this year on the biomass project the utility has proposed to build in north-central Wisconsin. As of Friday, however, the utility had not decided whether to build that project because it and Domtar Corp. were still reviewing whether they can accept conditions imposed by the state Public Service Commission that aim to bring down the overall cost of the project to customers.
A leading state renewable energy advocate said Friday that We Energies was backing away from a $60 million commitment with only about half of the money collected.
Renew Wisconsin, a group that worked with We Energies and other groups on a renewable energy collaborative, agreed not to object to the utility’s plan to build new coal and natural gas-fired power plants as part of that commitment, said Michael Vickerman, executive director.
“We looked at it as a commitment. They looked at it as a commitment, until a couple days ago,” Vickerman said of We Energies. “Now that the coal plant is up and running, it appears that the program has outlived its usefulness to We Energies.”
The 12.7% profit the utility earns on its investment in the $2.38 billion coal plant has been a key driver in record profits the utility reported in 2010. With the second unit of the coal plant completed in January, 2011 will be another record year for Wisconsin Energy Corp.
To Vickerman, the announcement is the latest in a string of setbacks for efforts to develop homegrown renewable energy and stem the flow of energy dollars out of the state. That includes Republican Gov. Scott Walker’s proposal to make it more difficult to build wind farms in the state and a GOP-sponsored bill to be considered in the Legislature next week that would allow utilities to import hydro power from large dams in Manitoba to meet the state’s renewable energy mandate.
Manthey, of We Energies, says circumstances have changed since its commitment, including the 2006 state law that requires 10% of Wisconsin’s electricity to come from renewable sources by 2015.
The utility says its projects are a significant investment in the state’s economy. When completed later this year, the Glacier Hills Wind Park in Columbia County will be the state’s largest wind farm, and its Blue Sky Green Field project is the second biggest renewable project in the state, Manthey said.
A recipient of funding from We Energies was disappointed with the utility’s decision. We Energies provided $30,000 toward a $160,000 solar and energy efficiency project at the Unitarian Universalist church on Milwaukee’s east side, said Tom Brandstetter, who led the project.
Without the utility’s help, completing the project “would have made it much more difficult,” he said.
Plus, he said, the program helped the utility’s image that it was committed to green power at a time when it was building new coal plants. “We’re going in the exact opposite direction that we need to,” Brandstetter said.
Manthey said the utility’s shift on the renewable energy development program would have no impact on its Energy for Tomorrow initiative, a green-pricing program under which certain utility customers agree to pay more on their monthly electric bills to support renewable energy.
By the end of the month, the utility is expected to file a detailed plan with state regulators to raise bills in 2012 and again in 2013. The funding plan would pay for the wind farm now under construction northeast of Madison as well as environmental controls being installed at the original Oak Creek coal plant.
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