Solar groups sue Wisconsin regulators over fixed charge fees

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Sierra Club and Vote Solar have filed a lawsuit with the Public Service Commission of Wisconsin over regulators’ approval of a rate settlement agreement between utility Madison Gas and Electric and intervenors, claiming that the utility’s monthly fixed charge imposes unnecessary costs on low-income customers and discourages investments in energy efficiency and rooftop solar.

The lawsuit also alleges that the charge violates Wisconsin’s landmark Energy Priorities Law, which requires maximizing energy conservation, efficiency, and solar generation.

“Wisconsin’s highest-in-the-Midwest fixed charges discourage conservation and local, clean energy investment,” said Vote Solar’s Midwest Regulatory Director, Will Kenworthy.

Fixed charges are not new and have long been a point of contention between utilities and residential solar advocates, who argue that the fixed rate undermines the bill savings that solar customers are trying to achieve. The rates also may add time to solar system payback periods, further hampering customers’ efforts to save money.

The lawsuit also asserts that the charge is discriminatory towards low-use customers and those on fixed incomes, especially retirees and customers living in smaller homes and apartments.

“We’ve all seen that the climate crisis and undeniable economic disparities require us to reevaluate our systems and how we operate our society,” said Sierra Club Wisconsin Chapter Director, Elizabeth Ward. “MGE’s inequitable rates undermine the progress we need.”

In addition to alleged discrimination, the lawsuit also calls out the Wisconsin Public Service Commission’s decision not to hold a hearing before allowing MGE to recover more than $20 million it over-collected. The lawsuit argues that these funds, which were gathered through customers’ bills, are owed to those customers.

Fixed charges have been a point of contention previously in the state. In 2016, regulators approved Wisconsin Power and Light’s proposal to raise the utility’s fixed charge from $7.67 to $15 a month for residential customers, and from $7.67 to $17 a month for commercial customers.

Update 2/5/21: This article has been corrected to reflect that Sierra Club and Vote Solar are involved in a lawsuit with the Public Service Commission of Wisconsin, not Madison Gas and Electric, and that Madison Gas and Electric’s fixed charge has not been instituted recently.

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