A group of Wisconsin state lawmakers is urging the Federal Energy Regulatory Commission (FERC) to reject a proposal by a coalition of utilities seeking to pause competition for major electrical transmission projects in the Midwest. The lawmakers, consisting of eight Assembly Republicans and four Senate Republicans, argue that competition is beneficial for ratepayers, leading to lower costs and fostering innovation, which is crucial given the current concerns over customer affordability.
Utility Concerns and Legislative History
The utilities, including Xcel Energy and American Transmission Company (ATC), claim that competition delays necessary upgrades to support the Midwest’s growing data center industry, which is vital for maintaining the U.S.’s competitive edge in artificial intelligence. They propose either allowing exemptions from competitive bidding on a case-by-case basis or suspending competition for five years.
Wisconsin lawmakers view this request as part of a long-standing battle over transmission market competition. Since 2011, FERC has required competitive bidding for regional transmission projects, a move supported by ratepayer advocacy groups to prevent inflated costs from local monopolies. However, utilities argue that competitive bidding has not consistently resulted in cost savings.
Impact on Local Utilities and Ratepayers
The competition has intensified as local utilities like ATC face challenges from national and international developers. Recent decisions, such as MISO’s reversal to award substations to ATC over a lower bid from startup Viridon, highlight the complexities of balancing cost and project timelines. The delay in awarding these projects has been criticized as unnecessary by ATC, which emphasizes the importance of timely completion to meet data center demands.
Ratepayer advocacy groups, including Wisconsin’s Citizens Utility Board, oppose the utilities’ request, citing examples like the Cardinal-Hickory Creek transmission line, which exceeded budget without competitive bidding. They argue that suspending competition would lead to unchecked cost increases for consumers.
Despite these concerns, the utility coalition has gained support from the International Brotherhood of Electrical Workers, emphasizing the critical nature of these projects for national security and economic competitiveness.
Original reporting: Wisconsin Watch — read the source article.
