Three utility companies can together purchase the planned Koshkonong solar farm for an estimated $649 million, the state’s Public Service Commission ruled Friday.
The decision comes amid a lawsuit challenging the project, which claims that the utilities and project developer skirted regulatory rules.
Wisconsin’s Public Service Commission (PSC) voted 2-0, with commissioner Tyler Huebner abstaining, to accept an application from Wisconsin Electric Power Company, Wisconsin Public Service Corporation and Madison Gas and Electric Company to purchase the plant after it is built.
The Koshkonong project, slated for construction in the towns of Christiana and Deerfield, would consist of a 300-megawatt solar array and a 165-megawatt battery system, installed across 2,300 acres of leased land.
The utilities plan to purchase the completed plant for an estimated $649 million, with an additional $35.2 million to reimburse the developer for construction costs, according to PSC documents.
Under the terms approved by the PSC, Wisconsin Electric Power Company would take the majority share of Koshkonong with 75% ownership. Wisconsin Public Corporation would own 15% and the remaining 10% would go to Madison Gas and Electric.
The project is currently owned by Koshkonong Solar Energy Center LLC, an affiliate of Chicago-based developer Invenergy.
“The Koshkonong Solar Energy Center continues the progress we’ve already made reducing carbon emissions, increasing cost-effective renewable energy and advancing new technologies to benefit all our customers,” Madison Gas and Electric Chairman, CEO and President said in a press release.
But as the utilities prepare to move forward, the town of Christiana is suing the PSC to stop the project, alleging that the utilities and Invenergy abused regulatory rules.
Last April, the PSC awarded Koshkonong a certificate of public convenience and necessity, without which it cannot move forward.
The commission’s review of the process was based on the assumption that Koshkonong is a “wholesale merchant,” meaning that the plant would sell electricity to other power companies rather than directly to consumers, as utilities do.
Under Wisconsin law, wholesale merchant plants are subject to lighter scrutiny by the PSC than utility plants. Wholesale merchant plants do not, for instance, need to prove that they satisfy the reasonable needs of the public for power supply.
The utilities filed their application to purchase the project in April 2021, just fifteen days after Invenergy submitted its request for certification.
“(Invenergy), in coordination with the utilities … are attempting to abuse the merchant plant (certification) process to establish a facility contemplated from before any docket was opened, to be owned and operated as a utility-owned facility, not a merchant plant,” the town wrote in its comments to the PSC filed March 7.
Christiana’s lawsuit claims that the project was incorrectly awarded its certificate of public convenience and necessity because it was weighed as a wholesale plant, and seeks to overturn the PSC’s decision.
Last week, in the first oral arguments for that lawsuit, a judge agreed to take judicial notice of the utilities’ application to purchase the plant, allowing the town to use evidence from the application to argue it is not a wholesale merchant plant.
The PSC approved the utilities’ purchase with conditions, one of which is that they must follow the same guidelines outlined to Invenergy when the initial certification was given.
Initial briefs in Christiana’s lawsuit will be filed by May 19.
This is a developing story and will be updated.
