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Wisconsin Utilities Settle Disputes Over Future Gas-Fired Generation

A settlement has been reached in a simmering dispute between Wisconsin's two major private-sector utility ownership groups over a proposed natural gas-fired 650 MW generation plant slated for Beloit, WI.

Technical hearings before the Wisconsin Public Service Commission (PSC) were scheduled to start Monday regarding a proposal that Wisconsin Power and Light Co. (WP&L) made last May.

Knocking heads are power plant proponents at Alliant Energy Corp.'s Madison, WI-based WP&L, and WEC Energy Group Inc.'s two utilities, We Energies and Wisconsin Public Service Corp. (WPS). The settlement lays the groundwork for collaboration among the utilities on both gas-fired and renewable generation projects in the 2020-to-2030 time frame.

The two private-sector utilities find themselves in different positions, with Alliant needing to acquire more power supplies and WEC having supplies in excess of its retail utility customers' needs. Alliant shut a coal-fired generation plant and stopped buying from a local nuclear plant, while WEC has cancelled construction of a $517 million gas-fired plant in the Fox River Valley that had been proposed by WPS.

Under the agreement, WP&L can continue to pursue the $700 million gas-fired plant, and WPS has the opportunity to buy 200 MW of the Beloit plant's output. In addition, the Alliant and WEC utilities will pursue joint development of renewable energy projects.

Alliant said Wednesday that it has filed the settlement with the PSC.

Alliant CEO Patricia Kampling said her utility has been able to work cooperatively with the WEC utilities "to find a solution that makes sense for energy customers across Wisconsin." Kampling said the deal will help keep down energy costs for Wisconsin customers.

The settlement, which needs PSC approval, includes provisions for Alliant's utility to buy up to 200 MW of gas-fired power generation that We Energies or WPS may develop in the 2020-30 period. There are also provisions for Alliant buying power from We Energies over three- of six-year interim periods between 2017-2023.

The provisions for renewables call for joint development of utility-scale projects of more than 50 MW. No large-scale renewable projects have been built in Wisconsin in recent years.

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