Wisconsin Public Service Corporation 2024 Rate Case
Synapse provided expert testimony and analysis to support the Sierra Club in reviewing Wisconsin Public Service Corporation’s (WPSC) 2024 rate case. Synapse’s testimony focused on the economics of two coal units that are not slated for near-term retirement, Weston 3 and 4. Synapse also reviewed WPSC’s long-term planning practices to determine if adequately reviews of the forward-going economics of its existing generating units.
We found that both Weston 3 and 4 have seen declining utilization over the past six years. Weston 3 in particular operated with low capacity factors and higher-than-average outage rates from 2018–2023. It was uneconomic to operate relative to the market in four out of the past six years, while Weston 4 saw only marginally positive net revenue over this time period. Given that Weston 3 is already more expensive to operate than market alternatives, we found that is in the public interest to retire the unit as soon as replacement generation is available. We recommended that WPSC commit to a retirement date for the unit and work to proactively procure replacement resources. We also recommended that WPSC analyze whether retiring and replacing Weston 4 would be more economic than converting it to operate on gas.
Despite the declining performance of the Weston units, we found that WPSC did not analyze whether the units were projected to continue providing value to ratepayers relative to alternatives at any point over the past six years. This does not reflect prudent resources planning practices and indicates that WPSC’s existing process for long-term planning, including its process for establishing unit retirement dates and procuring replacement resources, are inadequate. We recommended that the Commission direct WPSC to include more robust long-term planning in its future rate case applications to ensure that WPSC is utilizing lowest-cost resources to meet its capacity and customer service obligations.