AB174: Bill Text

2025 - 2026 LEGISLATURE

LRB-2777/1

EHS&KP:cjs

2025 ASSEMBLY BILL 174

April 14, 2025 - Introduced by Representatives O'Connor, Brooks, Green, Moses, Tranel, Vos and Mursau. Referred to Committee on Energy and Utilities.

AB174,2,10 An Act to renumber 1.12 (4) (cm), 16.75 (12) (e) and 66.0401 (4) (a); to renumber and amend 66.0401 (1e) (a) and 114.135 (7); to amend 1.12 (3) (b), 1.12 (5) (a), 16.75 (12) (a) 4., 66.0401 (1m) (intro.), 66.0401 (5) (a) and (e), 66.0627 (1) (bk) 2., 196.374 (3) (a), 196.378 (1) (ag), 196.378 (1) (am), 196.378 (1) (ar), 196.378 (1) (b), 196.378 (1) (fg), 196.378 (1) (fm), 196.378 (1) (fr), 196.378 (1) (g), 196.378 (1) (h) (intro.), 196.378 (1) (h) 1. a., 196.378 (1) (h) 2., 196.378 (1) (i), 196.378 (1) (o), 196.378 (2) (title), 196.378 (2) (a) 1., 196.378 (2) (a) 2. a. to f., 196.378 (2) (b) 5., 196.378 (2) (bm), 196.378 (2) (c), 196.378 (2) (d) (intro.), 196.378 (2) (d) 2., 196.378 (2) (e) 2., 196.378 (2) (e) 3., 196.378 (2) (e) 4., 196.378 (3) (title), 196.378 (3) (a), 196.378 (3) (c), 196.378 (4), 196.378 (4m) (title), 196.378 (4m) (a), 196.378 (4m) (b), 196.378 (4r), 196.378 (5) (intro.), 196.491 (1) (e) and 238.15 (1) (g); to repeal and recreate 196.378 (title); to create 13.94 (1) (q), 16.75 (12) (e) 1., 66.0401 (1e) (am), (bk), (bL), (bm), (bn), (bo), (br), (cm) and (cs), 66.0401 (7) to (12), 93.74, 114.135 (7) (a), 114.135 (7) (b) 3., 114.135 (7) (d), 196.378 (1) (e) and (em), 196.378 (1) (h) 1r., 196.378 (2) (a) 2. em., 196.378 (3) (a) 3., 196.485 (1) (cr), 196.485 (1) (ef), 196.485 (1) (hm), 196.485 (3g), 196.485 (3j), 196.485 (3r), 196.491 (1) (ar), 196.491 (1) (h), 196.491 (1) (i), 196.491 (3) (a) 1m., 196.491 (3) (a) 4., 196.491 (3) (a) 5., 196.491 (3) (a) 6., 196.491 (3) (d) 9., 196.491 (3) (d) 10. and 196.491 (3) (d) 11. of the statutes; relating to: transmission facilities; installation of large wind energy, large solar energy, and battery energy storage systems; installation of light-mitigating technology systems; and prioritizing nuclear energy resources.

Analysis by the Legislative Reference Bureau

This bill does the following, described in further detail below: 1) establishes a competitive bidding requirement for certain transmission facility contracts and establishes an audit process to review such contracts; 2) grants certain rights to incumbent transmission facility owners; 3) imposes requirements on the construction of large wind energy systems, large solar energy systems, and battery energy storage systems, including the purchase of certain agricultural conservation easements when such systems are located on prime farmland; 4) makes nuclear energy a state policy priority; and 5) requires the installation of light-mitigating technology systems on certain wind energy systems and transmission line towers.

Competitive bidding requirement for certain transmission projects

The bill requires owners of proposed transmission facilities for which a certificate of public convenience and necessity (CPCN) is required from the Public Service Commission to let certain transmission facility contracts by competitive bidding. Under the bill, a “transmission facility contract” is a contract for the design of, construction of, or furnishing of materials for a transmission facility. Current law requires a person seeking to construct a high-voltage transmission line exceeding one mile in length designed for operation at a nominal voltage of 100 kilovolts or more to obtain a CPCN from PSC. The bill requires owners of proposed transmission facilities for which a CPCN is required to let transmission facility contracts having an estimated cost of performance that exceeds $1,000,000 on the basis of sealed competitive bids and to award transmission facility contracts to the lowest responsible bidder. If fewer than three bids from responsible bidders are received for a contract, the transmission facility owner must solicit additional bids for at least 30 additional days, and if fewer than three bids from responsible bidders are received after the additional bidding period, the owner must document that circumstance. A transmission facility owner may require a person, before the person submits a bid for a transmission facility contract, to submit a statement containing information relating to the person’s financial ability, equipment, experience in the work prescribed by the contract, and ability to safely perform the work prescribed by the contract.

Also, under the bill, the owner of a proposed transmission facility that involves entering a transmission facility contract that the bill requires to be competitively bid must include in an application for a CPCN an estimate of the cost of construction, along with documentation that the estimate is the result of competitively bid transmission facility contracts. The bill also requires such a transmission facility owner to provide to PSC until construction is complete annual reports that include updated estimates of the construction cost and an explanation of any changes from prior cost estimates. Further, no later than 30 days after the transmission facility is placed in service, the owner must provide evidence to PSC that the transmission facility contracts performed in completing the transmission facility were awarded in compliance with the competitive bidding requirements established by the bill.

Audit requirements, return on equity reductions, and equity limitation

The bill requires the Legislative Audit Bureau to conduct an audit of 15 percent of the transmission facility contracts subject to the bill’s competitive bidding requirements that are performed related to constructing each transmission facility that requires a CPCN, as well as any contracts for which the Joint Legislative Audit Committee requests an audit. The bill requires LAB to file with PSC a detailed audit report, including specific instances of any violations of the competitive bidding process requirements. The bill requires PSC to open a docket on any such audit report it receives, hold a public hearing, and determine if the transmission facility owner violated any competitive bidding requirements.

In addition, if the owner of a transmission facility for which transmission rates are determined by the Federal Energy Regulatory Commission violates the bill’s competitive bidding requirements, the owner must seek approval of a tariff that provides a return on equity that is either half of MISO’s base return on equity with respect to the transmission facility or equal to the owner’s average cost of debt, whichever is higher. If the cost to construct a transmission facility for which transmission rates are determined by FERC exceeds the estimated cost provided to PSC, the owner must seek approval of a tariff that provides, for the portion of the cost to construct the transmission facility that exceeds the estimated cost, a rate of return on equity that is either half of MISO’s base return on equity or equal to the owner’s cost of debt, whichever is higher.

In determining whether the costs of a transmission facility exceeded the estimated costs for purposes of triggering a reduction in the transmission facility owner’s return on equity, the bill provides that costs that exceed the estimated cost but that are prudently incurred or that are a result of force majeure may not be considered excess costs.

Under the bill, the owner of a transmission facility for which a CPCN was required may not seek to recover in rates approved by FERC an amount of equity in the transmission facility that exceeds 50 percent of the project costs.

Rights of an incumbent transmission facility owner

The bill also grants to an incumbent transmission facility owner the right to construct, own, and maintain a transmission facility that has been approved for construction in the Midcontinent Independent System Operator’s (MISO) transmission plan and that connects to transmission facilities owned by that incumbent transmission facility owner. Under the bill, an “incumbent transmission facility owner” includes a transmission company or transmission utility (a cooperative or public utility that owns a transmission facility and provides transmission service in this state), regardless of whether this state is its principal place of business or where it is organized or headquartered. Under current law, MISO is an organization that is subject to the jurisdiction of the Federal Energy Regulatory Commission and that coordinates and controls electric transmission in a region of the country that includes this state. The bill provides that the right to construct, own, and maintain a transmission facility that connects to transmission facilities owned by two or more incumbent transmission facility owners belongs individually and proportionally to each incumbent transmission facility owner, unless otherwise agreed upon in writing.

Under the bill, if under MISO’s transmission plan a regionally cost-shared transmission line has been approved for construction and connection to facilities owned by an incumbent transmission facility owner, the incumbent transmission facility owner must give the Public Service Commission written notice regarding the owner’s intent to construct, own, and maintain the line no later than 90 days after approval of the transmission plan or 90 days after the date on which this bill becomes law, whichever is later. If the owner indicates that it does not intend to construct the line, the bill requires it to fully explain that decision in the notice to PSC. In that case, the bill allows PSC to determine whether the incumbent transmission facility owner or another entity must construct the line, taking into consideration issues such as cost, efficiency, and reliability. The bill defines “regionally cost-shared transmission line” to mean a high-voltage transmission line that is eligible for regional cost sharing and is not subject to a right of first refusal in accordance with the MISO tariff.

The bill requires an incumbent transmission facility owner with the right to construct a MISO-approved regionally cost-shared transmission line to, as soon as practicable after the information is available, submit a report to PSC, the assembly speaker, the assembly minority leader, the senate majority leader, the senate minority leader, and the governor detailing the amount of the costs of the transmission line project that are being charged to energy consumers outside this state.

The bill provides that the rights and responsibilities of incumbent transmission facility owners created under the bill are void if the President of the United States issues a lawful executive order, FERC issues a lawful order or rule, or Congress enacts a valid statute and that executive order, order, rule, or statute has the effect of repealing or nullifying provisions of MISO’s tariff that allow the owner of a transmission facility to allocate costs of the transmission facility over a region encompassing more than one state.

Regulation of large wind, large solar, and battery energy systems

The bill requires a person seeking to construct a battery energy storage system to obtain a CPCN from PSC. The bill defines a “battery energy storage system” as a device that occupies one acre or more and that captures energy produced at one time, stores it for future use, and later delivers it as electricity. The bill defines “large wind energy system” and “large solar energy system,” respectively, as a wind energy system or solar energy system with an electric generating capacity of 100 megawatts or more. Under current law, a person seeking to construct a large electric generating facility, specifically a facility designed with an electric generating capacity of at least 100 megawatts, must obtain a CPCN. The bill prohibits PSC from issuing a CPCN for a large wind energy system, large solar energy system, or battery energy storage system unless both of the following apply: 1) including the acres occupied by the system proposed by the applicant, the total amount of acres of land in the town in which the system is located that are occupied by large wind energy systems, large solar energy systems, or battery energy storage systems is not more than 2,000 acres; and 2) including the acres occupied by the system proposed by the applicant, the total amount of acres of land in the county in which the system is located that are occupied by large wind energy systems, large solar energy systems, or battery energy storage systems is not more than 5,000 acres.

Additionally, current law authorizes a city, village, town, or county (political subdivision) to restrict the installation or use of a wind energy system or solar energy system as long as the restriction serves to preserve or protect the public health or safety, does not significantly increase the cost of the system or significantly decrease its efficiency, and allows for an alternative system of comparable cost and efficiency. Current law also states that a political subdivision may not place a restriction on the installation or use of a wind energy system that is more restrictive than rules that PSC is required to promulgate on that subject. Current law defines “wind energy system” as equipment and associated facilities that convert and then store or transfer energy from the wind into usable forms of energy. and defines “solar energy system” as equipment that directly converts and then transfers or stores solar energy into usable forms of thermal or electrical energy.

The bill imposes certain requirements on a person seeking political subdivision approval or a CPCN for a large wind energy system, large solar energy system, or battery energy storage system. Specifically, the bill requires all of the following from a person seeking such approvals:

1. To submit with the application a decommissioning and site restoration plan, including a plan to clean, clear, and remove foundations from the site and to restore the land to its prior condition and a financial assurance obligation for the estimated cost of decommissioning.

2. To submit with the application a drainage plan, including plans to repair or replace any subsurface drainage affected during the construction or decommissioning of a large wind energy system, large solar energy system, or battery energy storage system.

3. To provide visual screening of a large solar energy system or battery energy storage system for certain nearby properties that have a residence within 250 feet of the system.

4. To make attempts to enter good neighbor agreements with owners of certain nearby properties.

5. To provide written notice, no later than 45 days before submitting a CPCN application, indicating interest in entering into an economic development agreement to each political subdivision in which the proposed facility would be located and take all commercially reasonable efforts to negotiate an economic development agreement with each political subdivision.

6. To provide written notice at least 45 days before submitting a CPCN application to each property owner located within one mile of a proposed facility, each political subdivision in which the proposed facility is proposed, and the American Indian tribal governing body for any land under that body’s jurisdiction that is within the project boundary.

7. To post notice of the proposed project at least 45 days before submitting a CPCN application by class 1 notice in the official state newspaper.

The bill requires PSC to create a pamphlet of not more than two pages, available on its website, that explains in plain language all provisions of the bill relating specifically to large wind energy systems, large solar energy systems, and battery energy storage systems, and requires PSC, if it receives a CPCN application for such a system, to distribute this pamphlet by mail or electronically to certain impacted property owners and to the political subdivision in which the project is proposed to be located.

Purchase of agricultural conservation easements required for large wind, solar, and battery systems

The bill also requires owners of large wind energy systems, large solar energy systems, and battery energy storage systems that are located on land that has a National Commodity Crop Productivity Index (NCCPI) of 0.6 or greater as identified by the Natural Resources Conservation Service of the U.S. Department of Agriculture (USDA) and that was prime farmland at the time that a CPCN was applied for for the system to purchase certain agricultural conservation easements before placing the system in service. Under the bill, “prime farmland” means land in use for an agricultural use or in use for a use that has agricultural value, including land that is part of a crop rotation or land enrolled in the USDA Conservation Reserve Program if the land is prime farmland, unique farmland, or additional farmland of statewide importance under the specifications of the USDA. An agricultural conservation easement prohibits the land subject to the easement from being developed for a use that would make the land unavailable or unsuitable for agricultural use.

Under the bill, an owner of a large wind energy system, large solar energy system, or battery energy storage system must purchase agricultural conservation easements on four acres of prime farmland for each acre of land on which the system is located that was prime farmland having an NCCPI of 0.8 or greater, and must purchase such easements on two acres of prime farmland for each acre of land on which the system is located that was prime farmland having an NCCPI of not less than 0.6 and not more than 0.8 or that was unique farmland or additional farmland of statewide importance. The bill requires an owner to make commercially reasonable efforts to purchase agricultural conservation easements on acres of prime farmland in the following order of priority: 1) acres adjacent to the system and owned by an owner-operator; 2) acres located in the same county as the system and owned by an owner-operator; 3) acres located in an adjacent county and owned by an owner-operator; 4) acres adjacent to the system; 5) acres located in the same county as the system; 6) acres located in an adjacent county; and 7) acres located in this state. Under the bill, an “owner-operator” is a person who owns land and who materially participates in a trade or business that engages in an agricultural use on that land. The purchase cost of an agricultural conservation easement required under the bill is $2,500 for each acre, and is paid to the landowner in equal payments made over five years.

Under the bill, an application to PSC for a CPCN for a proposed large wind energy system, large solar energy system, or battery energy storage system must include proof that the applicant has entered into contracts for the purchase of agricultural conservation easements required by the bill. The bill also requires the agricultural conservation easements to include a provision that authorizes the Department of Agriculture, Trade and Consumer Protection, on behalf of the state, to bring actions to enforce or defend the easements. The bill prohibits large wind energy systems, large solar energy systems, and battery energy storage systems from being separated into multiple systems to decrease the nominal capacity of each system below 100 megawatts to construct the systems without purchasing the agricultural conservation easements required by the bill.

Nuclear energy as a state policy priority

The bill establishes as state policy that nuclear energy is a high-priority option, second only to energy efficiency and conservation, to be considered in meeting the state’s energy demands, over noncombustible renewable energy resources and combustible renewable energy resources. Under current law, it is the goal of the state that, to the extent it is cost effective and technically feasible, all new installed capacity for electric generation be based on renewable energy resources. The bill adds nuclear energy to this focus, along with renewable energy. Current law also provides that, in designing all new and replacement energy projects, a state agency or local governmental unit must rely to the greatest extent feasible on energy efficiency improvements and renewable energy resources if those are cost effective, are technically feasible, and do not have unacceptable environmental impacts. The bill adds nuclear energy resources to this list of prioritized resources.

Current law requires the Department of Administration to establish renewable energy percentage goals for certain state agencies to meet in 2007 and 2011 and then to submit a report to the governor and the legislature each March 1 concerning the degree of attainment of those goals during the preceding year. Under the bill, beginning in 2026, those reports must include nuclear energy in the definition of “renewable resource” for the purpose of that report.

The bill expands current laws that govern state renewable resource goals and renewable resource credits to include as an eligible resource one that derives electricity from nuclear power. The bill changes the terminology in these laws to use the term “low-carbon-emission” instead of “renewable.”

Light-Mitigating technology systems

The bill imposes lighting requirements on certain wind energy systems and high-voltage transmission line towers. Under the bill, such structures placed in service on or after the effective date of the bill must have a light-mitigating technology system (LMTS) installed; an LMTS is triggered by aircraft detection or otherwise reduces the impact of lighting necessary to make tall structures conspicuous to aircraft to avoid collisions. The bill applies to wind energy systems and high-voltage transmission line towers that meet the criteria for which construction or alteration would be subject to Federal Aviation Administration notice requirements, including a structure that is more than 200 feet above ground level (utility structures).

Current law prohibits the erection of any building, structure, tower, or other object that exceeds specified heights without a permit issued by the Department of Transportation (height permit). The bill extends this height permit requirement to any utility structure. However, DOT may not issue a height permit for a utility structure unless the applicant has received FAA approval to install an LMTS on the utility structure and the height permit includes as a condition that the applicant install the LMTS no later than 24 months after issuance of the permit. Current DOT rules implementing height permits govern enforcement of height permit requirements and conditions, including penalties and possible revocation.

The bill requires that a person be approved by FAA to install an LMTS on a utility structure. The bill specifies that a person who is selected to install an LMTS on a utility structure as required under the bill must provide notice to DOT and to the city, village, or town in which the utility structure is located of the progress of the installation. If the installation is delayed beyond the 24-month installation requirement, the bill requires the installer to provide an update on the reasons for the delay and the current status of the installation to DOT and the city, village, or town at least every three months. The bill allows DOT to establish policies and procedures to set a uniform schedule for submitting these notices and updates.

Also, the bill requires the owner of a utility structure that is placed in service before the bill’s effective date and for which DOT has issued a height permit to submit a report to PSC no later than July 1, 2026, on the commercial feasibility of installing an LMTS on the utility structure.

For further information see the state fiscal estimate, which will be printed as an appendix to this bill.

The people of the state of Wisconsin, represented in senate and assembly, do enact as follows:

AB174,1 Section 1. 1.12 (3) (b) of the statutes is amended to read:

AB174,3,6 1.12 (3) (b) Renewable and nuclear energy resources. It is the goal of the state that, to the extent that it is cost-effective and technically feasible, all new installed capacity for electric generation in the state be based on renewable energy resources, including hydroelectric, wood, wind, solar, refuse, agricultural and biomass energy resources, or nuclear energy.

AB174,2 Section 2. 1.12 (4) (cm) of the statutes is renumbered 1.12 (4) (am).

AB174,3 Section 3. 1.12 (5) (a) of the statutes is amended to read:

AB174,3,14 1.12 (5) (a) In designing all new and replacement energy projects, a state agency or local governmental unit shall rely to the greatest extent feasible on energy efficiency improvements and renewable or nuclear energy resources, if the energy efficiency improvements and renewable or nuclear energy resources are cost-effective and technically feasible and do not have unacceptable environmental impacts.

AB174,4 Section 4. 13.94 (1) (q) of the statutes is created to read:

AB174,4,2 13.94 (1) (q) Conduct audits under s. 196.485 (3r) (c) 1. of 15 percent of transmission facility contracts related to each certificate issued under s. 196.491 (3) that are required to be competitively bid under s. 196.485 (3r) (b), and as the joint legislative audit committee directs, conduct audits of other transmission facility contracts that are required to be competitively bid under s. 196.485 (3r) (b).

AB174,5 Section 5. 16.75 (12) (a) 4. of the statutes is amended to read:

AB174,4,7 16.75 (12) (a) 4. “Renewable Except as provided under par. (e), “renewable resource” has the meaning given in s. 196.378 (1) (h) 1., 1m., or 2. and includes a resource, as defined in s. 196.378 (1) (j), that derives electricity from hydroelectric power.

AB174,6 Section 6. 16.75 (12) (e) of the statutes is renumbered 16.75 (12) (e) 2.

AB174,7 Section 7. 16.75 (12) (e) 1. of the statutes is created to read:

AB174,4,11 16.75 (12) (e) 1. Beginning in 2026, and only for purposes of the report under this paragraph, “renewable resources” also includes nuclear energy resources.

AB174,8 Section 8. 66.0401 (1e) (a) of the statutes is renumbered 66.0401 (4) (ag) and amended to read:

AB174,4,16 66.0401 (4) (ag) “Application In this subsection, “application for approval” means an application for approval of a wind energy system under rules promulgated by the commission under s. 196.378 (4g) (c) 1.