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Judge pauses construction of Cardinal-Hickory Creek power line; opponents face $32M bond

A Dane County judge has agreed to temporarily halt construction of a power line through southwest Wisconsin, provided opponents of the project can come up with millions of dollars to cover potential costs of a delay.

Utilities had planned to begin building the $492 million Cardinal-Hickory Creek transmission line between Middleton and Dubuque, Iowa, on Oct. 25, according to court documents.

Judge Jacob Frost granted a request Monday for an injunction to put the project on hold while the courts consider challenges to its permit, agreeing that clearing land would result in damage that could not be easily repaired if the line is ultimately stopped.

“This power line could still very well happen,” Frost said. “The one bell that really can’t be unrung is if I let the work go forward while the process is still being challenged.”

A joint venture of American Transmission Co., ITC Midwest and Dairyland Power Cooperative, the 102-mile line is the subject of multiple state and federal legal challenges from the Driftless Area Land Conservancy and Wisconsin Wildlife Federation.

The plaintiffs said an injunction was necessary to “prevent irreparable damage to Southwest Wisconsin’s landscape, natural environment, family farms, rural communities, and businesses” that would result from cutting trees, bulldozing 150-foot-wide corridors and pouring foundations.

In a statement, ATC said it is “disappointed” by the order and that, if implemented, a delay could add $30 million to the price tag. The injunction “will cause needless construction delays, postpone the delivery of essential project benefits to electric consumers, and add unnecessary costs to this essential capital project – costs which will ultimately be passed along to energy consumers,” the company said.

“The public shouldn’t have to pay for an extra $30 million because DALC and WWF got an injunction they shouldn’t have,” ATC attorney Brian Potts told the judge.

A six-month delay would also cost ATC about $2 million in profits, according to the company.

Frost ordered the plaintiffs to post a bond of $32 million to cover those costs should the project ultimately go forward.

Howard Learner, the lead attorney for DALC and WWF, argued the bond amount is unaffordable and amounts to another due-process violation. Learner suggested a bond of $10,000, “which is substantial for a not-for-profit group.”

Frost said there was evidence to support the potential damages, and nonprofit organizations aren’t exempt.

“My hands are tied by the statute,” Frost said. “The law is what it is.”

Learner said the groups are still considering their options as they seek a similar injunction from the federal courts, where they have challenged three construction permits. A hearing on that request is scheduled for Friday.

“That excessive bond provision defies common sense, impairs meaningful citizen participation, and inflicts irreparable harm without justification,” Learner said. “It is contrary to fundamental fairness and undermines public confidence in the fairness of the utility regulatory and judicial review system.”

Case on hold

The case before Frost is on hold while the state Supreme Court considers whether a former regulator’s relationships with utility executives created a conflict of interest that could invalidate the permit.

The utilities, which have spent at least $126.4 million so far on the project, say it is “critical to ensuring Wisconsin can transition to a cleaner, more reliable, and more affordable energy future” by enabling the import of energy from wind turbines in Iowa.

DALC and WWF, along with Dane County and other local governments, challenged the PSC’s unanimous approval of the project, which they argue is an unneeded boondoggle that will be a blight on the sensitive Driftless region.

The groups claim that former Public Service Commissioner Mike Huebsch’s personal relationships with executives connected to the project created an appearance of bias, which Frost said would be enough to invalidate the permit.

In September the state Supreme Court agreed to take up that part of the challenge after Huebsch argued that is an impossible and unlawful standard for public officials.

Subpoena blocked

The high court also blocked a subpoena requiring Huebsch to testify in court, effectively putting the lower court case on hold.

Huebsch applied to be CEO of Dairyland after leaving the commission in February 2020, though he did not get the job. In June, the project owners revealed that Huebsch had communicated with utility executives using the encrypted messaging app Signal and asked the PSC to revoke and reissue the permit. The PSC has not acted on that request.

Huebsch has testified he used Signal to send encrypted, ephemeral messages to longtime friends in the industry but never to discuss official commission business. And he says he applied for the job as a courtesy to Brian Rude, a friend and mentor who was the La Crosse-based utility’s director of regulatory affairs.

Huebsch, a former state legislator and member of Gov. Scott Walker’s cabinet, argues such relationships do not constitute a conflict of interest.

While the question remains before the Supreme Court, Frost indicated that the plaintiffs are likely to succeed with their bias claims, which would undermine public faith in the PSC.

“The problem is when you can’t trust the process, when people look at it and say it doesn’t look like it was fair,” Frost said. “If you don’t have the process protected, what do the results matter?”