Focus on Energy Program

Summary

Focus on Energy provides information, financial assistance, technical assistance and other services to residents, businesses, schools, institutions and local governments on energy efficiency and renewable energy*. Financial assistance takes the form of rebates, grants and loans. The program was initially created by Act 9 of 1999 as a public benefit fund (PBF), which also provided energy assistance programs for low-income residents (the Home Energy Plus Program). 

Each electric and natural gas investor-owned utility is required to spend 1.2% of the latest 3-year average of its gross operating revenue on energy-efficiency programs and renewable-resource programs. With WPSC approval, a utility may retain a certain portion of the revenue it is required to spend on statewide programs to administer or fund a new energy-efficiency program for the utility's large commercial, industrial, institutional or agricultural customers. The WPSC is required to conduct a review of the programs every 4 years. Focus on Energy is required to meet certain energy savings requirements over each 4-year period. 

Large Energy Customers

"Large energy customers" may implement and fund an energy efficiency project with WPSC approval, may deduct the cost from the amount the customer is required to pay its utility for cost recovery. The utility, in turn, deducts that amount from the amount that it is required to spend on statewide or utility-administered programs. A "large energy customer" is defined as a customer that has a monthly energy demand of at least 1,000 kilowatts or 10,000 therms of natural gas and, in any month, has been billed at least $60,000 for electricity or natural gas for all its facilities within a utility's service territory.

Municipal and Cooperative Utilities

The state's municipal utilities and electric cooperatives have the option of participating in the state program or operating their own "commitment-to-community" programs, which are similar to Focus on Energy. There is a cap on fees for these programs of the lesser of $375 per month or 1.5% of the total other monthly charges. The WPSC does not oversee "commitment-to-community" programs, but cooperatives and municipal utilities are required to submit annual program audit reports to the WPSC. 

History

The original legislation required utilities to fund energy efficiency programs and renewable energy programs through (1) a public benefits fee that utilities collect directly from customers and (2) mandatory utility "contributions," which utilities recover from customers in rates. The amount of the charge was based on levels of utility expenditures for energy programs prior to the enactment of Act 9. The fee generated approximately $16 million annually, and the charge generated approximately $46 million annually. In fiscal year 2005, these two sources of revenue generated a combined total of $62.9 million for renewable energy and efficiency. In addition, the state's five major investor-owned utilities administered and funded several related programs required by the WPSC. In 2004, the five utilities spent a combined total of approximately $38.8 million on these programs, which included energy-efficiency projects, renewable-energy projects, load management, and related measures.

Focus on Energy was restructured in March 2006 by S.B. 459 (2005 Act 141). This law, most of which took effect July 1, 2007, replaced existing renewable energy and energy efficiency PBF programs with programs that utilities create and fund through contracts with private program administrators, with oversight and approval by the Wisconsin Public Service Commission (WPSC). Because Act 141 requires utilities to pay directly for programs, the state will not be able to transfer or otherwise use these funds for general obligations. (From 2002 to 2006, the governor and legislature transferred or reallocated more than $108 million from the PBF to the state's general fund or for other uses.) Thus Focus On Energy is no longer precisely a state public benefits program, although it remains a statewide program that serves many of the same purposes that PBFs serve in other states.

*The definition of "renewable resource" under Wis. Stat. § 196.374 includes solar, wind, water power (i.e., hydroelectric), biomass, geothermal, tidal or wave, and fuel cells that use renewable fuels. However, at present Focus on Energy does not offer incentives for all of these technologies. Please see the individual listings on the program website for detailed eligibility information.