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Wisconsin regulators defend renewable energy suspension

Wisconsin regulators defended a decision Wednesday to suspend renewable energy funding from a popular utilities program, despite criticism from businesses that it damages the state’s renewable energy marketplace.

Public Service Commission spokeswoman Kristin Ruesch said a Focus on Energy program geared toward renewable energy was over budget and not cost effective. But she said they’re still analyzing how it may be restored later this year.

The suspended program, introduced in 2002, offers monetary incentives to businesses and residents to install renewable energy systems. In recent years, between 8 to 10 percent of the Focus program’s recent $85-$90 million budget was set aside for it.

But Ruesch said the Focus program has a smaller budget now, after Gov. Scott Walker’s state budget placed a 1.2 percent cap on how much residents can be charged through utility bills to pay for the Focus program.

That cap halted a possible annual increase to the Focus program’s budget that began in 2010 and could have continued through 2014. The budget is now at about $100 million. Ruesch said the renewable energy incentives program wasn’t making enough money for what was being allotted to it. With the Focus program having less cash, the commission had to make a decision.

“The money has to come from somewhere, and right now it’s rate payer dollars,” she said. “We have an obligation that it’s spent in a cost effective way.”

But the decision has caused a backlash from renewable energy supporters around the state. More than 150 Wisconsin groups, including businesses, signed an open letter to the PSC on Monday criticizing the funding suspension. Michael Vickerman, executive director of energy advocacy group RENEW Wisconsin, spearheaded the open letter, and criticized the commission for not being clear on when funding may resume.

A PSC response letter from Gas and Energy Division Administrator Robert Norcross was sent Wednesday that clarified a more concrete estimate by the end of March. That’s when Shaw Environmental and Infrastructure, the Focus program’s administrator, will present PSC with an evaluation on the program’s merits.

Vickerman said he appreciated the letter’s budgetary explanation, but he was critical on the lagged response time in restoring the program’s budget.

“We understand what happened, but in the end there was a failure in management to track how many projects had been approved over the years,” he said. “We would respectively point out that it’s been seven months since the program was suspended and businesses are starting to feel the pain.”

Jolene Sheil, director of the Focus on Energy program, said Shaw has been busy focusing on energy efficiency programs for both residents and businesses. But she’s hopeful the commission’s new measure to test the cost effectiveness of renewable energy will help how it’s budgeted down the road. She said they can’t rush things or it will hurt the Focus program.

“If we don’t plan it correctly, it affects cost benefits to the entire Focus program,” she said. “We put the whole program in jeopardy.”

Vickerman said renewable energy has a major impact on job creation, the environment and long-term saving costs to customers who use it. He said the program’s suspension damages a strong renewable energy marketplace the state has cultivated over the last decade.

Vickerman said he’s hopeful funding will resume by June, but he worries budget levels will not be the same. He said policy consistency is critical to keeping energy-based businesses here in Wisconsin.

“Incentives that change or are modified frequently reduce the confidence of a particular business to expand or continue operating here,” he said.