A recent state projection shows Wisconsin will lose more than $2 billion in sales tax
revenue because of an exemption written into the 2325 state budget for data centers, a
break design to promote economic development. Three years later, the state is swimming in new
data centers with consumer concerns about water and energy usage, but in a win for consumers,
the Wisconsin Public Service Commission just ruled that existing electricity customers should not
pay a single cent to subsidize the service of data centers. The ruling is also a major win for
the Citizen's Utility Board, which fought on behalf of customers. Executive Director of CUB,
Tom Content, joins us now with more. And thanks very much for being here.
Oh, great to be with you. So you've said that this case was the most significant one that CUB
has ever been involved in. So when the PSC ruled, what was your reaction?
I was frankly surprised. I've had a good feeling that we were going to get some of what we asked
for in terms of significant changes to what the proposal was, but we got the vast majority of our
changes or changes that addressed our concerns. The commissioner has really sent a message.
Even though they can't control every cent, they sent a message that every dollar needs to be
accounted for. And as one of the commissioners put it, every cent should be paid for by the tech
companies. So how does the proliferation of data centers in Wisconsin engage consumers
in a way that other rate cases may not have?
I think it's a combination of concerns about rising energy costs because we've already come
into this period with rising energy costs that have risen at rates higher than inflation,
paired with the local community reaction and basically the Wisconsin reaction as noted in
the Marquette polls to data centers. And the Marquette poll that just came out
showed a lot more clarity about where Wisconsinites stand about data centers
than it showed about who's running for governor. And by a two-to-one margin, people said that
costs of data centers outweigh the benefits. And I think layered into that is fear of AI
and what the impacts of AI are on the economy and society down the road.
I think that played into it too. Because I understand that thousands of people kind of came to
cub and said, yes, we want the PSC to rule in this way. Thousands of people went to the PSC
hearings or PSC hearings, or submitted comments online. And so those could have been people in
Milwaukee, people around the state, we energies customers and others. Frankly, the tech companies
and the utility were saying the right things all along that they were going to meet their demand
or that they were going to play their own way. But for us, the devil was always in the details
and we found some loopholes and just areas of concern where we thought the risks that customers
were still going to be on the hook were too high with what the proposal was.
So does the ruling mean that power company customers will not be on the hook at all
for the giant energy needs of these data centers?
They went as far as they could. They ran into a couple areas where they couldn't go as far as
they wanted because certain things were out of the state's control. And what I mean by that is if
people may have seen that at the White House, the tech companies were at the White House
pledging to pay their own way and signed a rate payer protection pledge.
Now that was more of an optics document, a rhetoric document, and then it was non-binding,
but it actually committed the tech companies to pay their way for all the network upgrades,
which to us sounds like the power lines, right? The big power lines and the fact is
our power line company, American Transmission Company, that is building $2 billion of infrastructure
to feed these data centers, is actually regulated out in Washington, D.C. So the
State Public Service Commission couldn't change that. And so as a result, the commissioner sent
a message that they could only go so far, but they called on ATC and the We Energy's parent
company to make changes that would protect customers from frankly billions of extra costs
tied to these projects. What else stood out for you from the PSC on this case?
I think what stood out is that the fact that the data centers will be on the hook for 100%
of the new power plants. There was one scenario where other customers, small businesses, homeowners,
renters, and other businesses would be on the hook for up to 25% of the cost of new power plants.
And that's not a small number. We Energy's has already gotten approval for almost $2 billion in
projects and has another $6 billion in the queue. So a quarter of that would have been a couple
billion dollars on the hook that customers would have been responsible for. So that was the biggest
change and one that we really appreciated. All right. Well, we appreciate you joining us today
on this Tom content. Thanks so much. Thank you.
Yeah, it almost feels like when was the last time the little guy won?
Exactly. I know it feels like I can't speak for all my past executive directors,
but in terms of the billions of dollars that are involved in this one versus a typical rate case,
which is there'd be hundreds of millions, but this is multiple billions. So that's how
it felt good. When time goes fast on these interviews, right? Yes. Yes. And thank you for
your patience at the head of it. Oh, no, no problem. And we have if you want to point people
to more resources, we have some on our website on our data centers page. Okay.
Thank you so much. Safe travels back. All right. All right. Take care. All right. Bye. Bye.