Phasing Out Coal Plants: A Strategic Move Towards Clean Energy (2023)

In a groundbreaking announcement, Wisconsin utility WEC Group revealed its accelerated timeline to phase out coal by 2032, three years ahead of schedule. This decision impacts major plants, including We Energies' Oak Creek facilities slated for closure in 2024 and 2025, and the Columbia Energy Center, the state's largest coal plant co-owned by WEC and Alliant, set to shut down by 2026. Weston Unit 3, co-owned with Dairyland Power Cooperative, will follow suit by 2031.

Urgency for Responsible Closure

While advocates applaud the move, they emphasize the need to ensure that ratepayers are not burdened with lingering costs from closed coal plants. Current policies allow utilities to recoup investments, including expensive pollution controls, and earn a rate of return after a coal plant ceases production. The urgency to address this issue has led to discussions about innovative financial strategies.

Securitization: A Bold Step Towards Cost Savings

Advocates propose an increased use of securitization, a process where coal plant owners issue bonds to alleviate debt after closure, similar to refinancing a mortgage. The emphasis is on challenging the notion that utilities can continue to profit from closed coal plants. Rate cases before the state Public Service Commission for both We Energies and Alliant are pivotal arenas for debating the financial aspects of these closures.

Disallowing Profits: A Radical Proposition

The debate includes calls for bold steps, such as disallowing any profit from closed coal plants. Critics argue that utilities should not be profiting from brownfield sites, and alternatives like securitization should be explored comprehensively. Citizens Utility Board Executive Director Tom Content stresses the importance of considering options that genuinely save customers money.

Ratepayer Concerns and Commission Frustration

Alliant currently enjoys a 10% profit on investments, even post-closure, while We Energies is allowed a 9.8% profit. Recent rate case hearings express commission frustration with Alliant's lack of consideration for reducing the burden on ratepayers after the closure of the Edgewater coal plant in Sheboygan by 2025. The commission's scrutiny of cost reduction measures reflects the growing concerns about the financial implications for consumers.

Levelization as a Compromise

In an attempt to find middle ground, a settlement between Alliant and the Citizens Utility Board involves the use of levelization to recoup investments for the Edgewater plant. However, critics argue that such arrangements might increase the overall cost to ratepayers over time.

Securitization Legislation: A Potential Game-Changer

A bill introduced by Republican state Sens. Robert Cowles and Duey Stroebel aims to expand the use of securitization. LRB 4441 proposes a broader definition of "environmental control" to include coal plant closures. If enacted, this legislation would empower the Public Service Commission to order companies to utilize environmental trust bonds post-closure, a significant shift in regulatory authority.

We Energies and Alliant Cases: Divergent Approaches

Examining specific cases, We Energies' handling of the Oak Creek plant's closure comes under scrutiny. The Citizens Utility Board challenges the adequacy of cost reduction alternatives, advocating for comprehensive securitization. The Wisconsin Industrial Energy Group, representing large industrial energy users, echoes concerns about We Energies' proposed securitization plan, emphasizing the need for a more extensive approach.

Federal Funds: A Potential Relief

The Inflation Reduction Act's Energy Infrastructure Reinvestment Program emerges as a potential source of relief for the costs associated with closed coal plants. Alliant, for instance, could leverage low-interest loans to retool the Edgewater site for clean energy goals, potentially saving millions and aligning with the federal push toward cleaner energy.


As Wisconsin navigates the complexities of transitioning away from coal, the financial implications for ratepayers remain a critical aspect. The ongoing debates, legislative proposals, and specific cases involving We Energies and Alliant underscore the challenges and opportunities in achieving a responsible and cost-effective shift to cleaner energy sources. The journey towards a sustainable energy future demands innovative solutions, bold regulatory steps, and a commitment to balancing financial interests with environmental stewardship.

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