We Energies submitted a tariff or rate request requiring data centers to pick up 100 percent of additional power plant costs for their enormous energy needs. The three-person commission faced an unprecedented and pivotal moment after receiving a massive outpouring of 2,000 public comments.
"This is a significant and consequential tariff docket," Public Service Commission Chair Summer Strand said.
The decision is not about the construction of or concerns with data centers in the state, but specifically reviews the We Energies rate request to meet the growing energy demand to operate the facilities.
"Wisconsin customers should not pay a single cent to subsidize the service of data centers or very large customers. Not now and not decades from now," Public Service Commission Commissioner Kristy Nieto said.
The commission believes concerns about those costs required some modifications to the We Energies proposal for data centers in southeast Wisconsin.
Watch: PSC sides with We Energies: Data centers should pay for their own energy costs
"To increase transparency and visibility into the relationship between the utility and its data center customers, and to ensure the tariffs we approved today include the necessary protections to safeguard existing customers from harm," Strand said.
Among the key changes made by the commission are extending the contract agreement with data centers from 10 years to 15 years and changing the megawatt size of data centers required to pay from 500 to 100 to include smaller facilities.
"The steps forward that they took so far are improvements to what We Energies originally proposed that we think are going to be important safeguards for customers," Citizens Utility Board representative Tom Content said.
Content has been following this case closely. He said one big concern the commission shares is over how to address expensive energy costs with transmission lines plugged into data centers.
"They can't guarantee that that has been fixed entirely, but they took a big step forward today to say this is an important issue and we want the utility to address this," Content said.
We Energies said they are aware of additional concerns with transmission lines and that data centers will cover the costs.
The utility has a separate rate increase proposal for residential and commercial customers before the commission, but that will not be taken up until the fall.
We Energies issued the following statement after the decision was announced:
We appreciate the Commission’s unanimous decision today to approve our Customer Protection Plan, which ensures that no costs to serve data centers will be subsidized by, or shifted to, other customers. The Commission and their staff spent countless hours over this 13-month public process, and we value their thorough review of this important issue.
The Commission’s decision is an important step and underscores the importance of our plan to ensure data centers pay their full share for the power they use in our state. That is important to us and to the data center companies we are working with. It also advances critical investments in AI in Wisconsin while ensuring transparency and fairness for all customers.
Our customers count on us every day for the energy they need, and we recognize our responsibility to continue providing safe and reliable energy. As data centers come to Wisconsin, we are working to make sure every customer benefits economically, without being forced to cover the costs for someone else’s power.
Port Washignton neighbors react to PSC discussions
One of those very large customers, or VLC's, is Vantage Data Centers, the company currently building a massive $15 billion data center in Port Washington.
Neighbors there remain split on the data center itself, but neighbor Pat Curtiss told Ozaukee County reporter Alex Gaul the PSC's statements are reason to be optimistic.
"You gotta trust them. Why would they want to hurt people?" Curtiss said. "It's public record now. It's not like they can go back on, like politicians say things and don't do it. This is a little bit different."
Still, other neighbors like Tom Cotter worry the statements are not enough for him to divorce the idea that data centers are driving up rates.
In a separate rate proposal, We Energies is proposing an average of 9.2% rate increase for businesses and residential customers over the next two years.
"Them saying that doesn't really give me a lot of confidence," Cotter said. "Especially if there's going to be a rate increase, we've got to have a lot more justification for it."
The current We Energies proposal was just submitted weeks ago and will not be ruled on for several months.
This story was reported on-air by Charles Benson and Alex Gaul and has been converted to this platform with the assistance of AI. Our editorial team verifies all reporting on all platforms for fairness and accuracy.
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