WisBusiness: Conference speakers call for more PSC regulation

By Brian E. Clark

MADISON – It’s a given that Wisconsin energy costs are headed up, what with the need to finance new power plants and transmission lines.

But for consumers – industrial, commercial and residential – to be confident that those rates are fair, the body that regulates the state’s utilities needs to be reformed, participants in an energy forum said Wednesday.

For starters, members of the Public Service Commission and top aides should be barred from going to work for a utility or a firm that represents utilities for a year after leaving the commission.

“That’s a minimum,” said Wisconsin Industrial Energy Group President Nino Amato, who presented a 14-point “Ratepayers’ Bill of Rights” at the conference. His organization, which sponsored the all-day session, represents companies that employ more than 60,000 residents.

Currently, former commissioners are only barred from speaking before the PSC for a year after they leave. Three one-time commissioners have left the regulatory body in the past decade to work for utilities, a trend Amato and others called “disturbing.” The trio are Scott Neitzel, Joe Mettner and former chairwoman Ave Bie. Neitzel works for MG&E, Mettner runs a consulting firm and Bie went to work for the public utilities section of the Quarles & Brady law practice.

Amato praised the PSC for some recent actions and said he hopes new chairman Dan Ebert will work to limit rate increases.

And he said he supports building of environmentally sound new plants, while at the same time encouraging conservation. But he said the PSC has been too generous in granting rate increases, which he said have been the highest in the nation outside of Alabama. A one-time head of the Commerce Department’s Forward Wisconsin effort, he said the Badger State once had some of the lowest power costs in the region – a fact that made it attractive for businesses to relocate here.

Since 1997, however, he said Wisconsin’s energy rates have increased by roughly 30 percent, leading some companies to expand elsewhere.

“I don’t expect us to be at the bottom again, but it would be nice to get to somewhere in the middle,” he said.

Paul Linzmeyer, president of Bay Towel, Inc., supported Amato’s reform proposals and said the PSC needs to help businesses that are reeling from climbing power rates. And though he said it is not illegal for former commissioners to go to work for utilities after leaving the PSC, he said the practice needs to be stopped.

“How can anyone in their right mind think it is proper for a regulator to jump to a regulated utility,” he said. “We shouldn’t even have to be talking about this.”

Linzmeyer also called for more transparency in how the PSC conducts its business and said deregulation of utilities could produce “disastrous” results such as occurred in California.

Rep. Spencer Black, D-Madison, said the public needs to be secure that PSC members are not making decisions on utilities “with an eye toward future employment.” He has introduced legislation (Assembly Bill 304) that mirrors Amato’s proposal on limiting former PSC members’ employment.

“I’m not casting aspersions on current PSC members,” Black said. “I’ve introduced a similar bill that would restrict legislators from becoming lobbyists for a year.”

“But the public needs to have confidence that the PSC is representing the public and not the utilities,” he said.

Not everyone supported the change however. Earl Gustafson of the Wisconsin Paper Council said he thought restricting PSC officials future employment might mean reduce the pool of qualified candidates. “Speaking as an individual, I don’t get it,” he said. “If it’s one day or one year, what’s the difference?”

Attorney General Peg Lautenschlager told the conference that she supports reforms.

“By creating a situation where some players have unique access to regulators makes things go awry,” she said.

“If certain individuals are able to lobby behind closed doors without input from others, it limits democracy and competition,” she said.

Last week, Lautenschlager scolded the state Ethics Board for not doing enough about the revolving door at the PSC. She said she was disappointed the board took no action on AB 304 (The Ethics Board responded that it supported the idea, but thought the bill was too specific, targeting only the PSC). Her department is also investigating open meetings violations by the PSC.

Lt. Gov. Barbara Lawton also spoke at the conference about the need for PSC independence and other reforms. She said she, too, backed strengthening ethical safeguards at the commission.

“I support AB 304 because it is an issue of public trust,” Lawton said. “In light of crippling rate increases, people need to believe that regulators are not being seduced by the regulated.”