Regulators stall on request to revisit Cardinal-Hickory approval in light of secret messages

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The Wisconsin Public Service Commission deadlocked Thursday on a request to rescind and reconsider the nearly $500 million Cardinal-Hickory Creek transmission line following a revelation last month that a former regulator had communicated secretly with proponents of the project.

In late June, the utilities American Transmission Co. and ITC Midwest asked the PSC to rescind a permit it had granted in 2019 authorizing the construction of the 100-mile transmission line from Dane County to Dubuque, Iowa. The unusual request came after documents unearthed in a court case showed that former commissioner Mike Huebsch had exchanged encrypted messages with utility executives before voting to approve the project.

After collecting comments about the revelation throughout July, the PSC reached a split decision on Thursday on ATC and ITC’s request to pull the approval and reissue a permit for the power line. Construction was scheduled to get underway on the project this fall.

Commission member Ellen Nowak said she was open to rescinding the permit and reconsidering the power line as quickly as possible to prevent a significant delay. PSC Chair Rebecca Valcq, however, said she is not in favor of pulling the PSC’s approval for the project.

“I don’t think commissioner Huebsch was biased,” Valcq said “I don’t think the record before us is flawed, and there’s nothing in the record that has changed since I made my initial decision.”

Commissioner Tyler Huebner recused himself from the case because of his involvement with the project before he joined the PSC.

The commission can now take up the issue at future meetings, and the courts could also decide if the PSC’s process was tainted by Huebsch’s contact with utility officials. Environmental groups have mounted four separate court challenges of the project in state and federal court.

Documents produced through a court case showed Huebsch had communicated with utility executives and contractors over a period of several years using the encrypted messaging app Signal. It’s unclear if the contents of his messages can be recovered.

Huebsch’s communications came after environmental groups had previously shown he had sought to become CEO of Dairyland Power Cooperative shortly after leaving the PSC, and voting to approve two large projects: Both the Cardinal-Hickory transmission line and the Nemadji Trail natural gas plant in Superior.

A Dane County Judge in May said he would revoke the PSC’s permit for the transmission line if environmental groups could show Huebsch was biased, or appeared to be biased, when he approved the project.

After the latest revelation, utilities ATC and ITC proposed the PSC rescind its previous approval of Cardinal-Hickory and issue a new permit without Huebsch, sidestepping legal challenges accusing the former commissioner of bias.

Environmental groups including the Driftless Area Land Conservancy and the Wisconsin Wildlife Federation, however, argue the commission should rescind the permit — and that commissioners Valcq and Nowak should sit out future considerations of the line because of their past involvement.

Dane County, which is also suing over the transmission line, argued in comments to the commission that the PSC shouldn’t rescind the permit for Cardinal-Hickory simply to quickly issue a new approval.

“Rescinding the CPCN in order to ram through a revote would only serve as a way for the Commission to avoid accountability,” Deputy Corporation Counsel Carlos Pabellon wrote in comments to the PSC. “No one can reasonably argue that what former Commissioner Huebsch did was appropriate. Yet, if the Commission adopts the Transmission Companies’ proposal, it would essentially be endorsing the practice.”

Meanwhile, the Citizens Utility Board, a ratepayer advocate, argued that the PSC should devote time to investigating the power line if it decides to rescind its approval. The commission approved the power line, in part, based on assumptions that it would take longer than it has for the use of solar generation to become widespread in Wisconsin.

Project proponents also called utility-scale battery storage projects “uneconomic” during the PSC’s deliberations, according to CUB. But since the commission approved the power line, three Wisconsin utilities have proposed such battery-storage centers. They include the Cardinal-Hickory proponent ATC, which has discussed plans for a 2.5 megawatt battery storage project near Waupaca as a cheaper alternative to a standard transmission line.

“Despite their assertions, the past 22 months have seen the applicants’ assumptions regarding the future of these technologies to be proven very wrong,” according to CUB. Follow @natebeck9