We Energies Backs Down on Contract Provision Conflicting with PSC Order

We Energies has admitted that it will not enforce a provision in its contract with Microsoft that conflicts with an order from Wisconsin's Public Service Commission (PSC).

The provision, which was part of a 15-year electric service contract signed last month, requires power plants built or purchased to serve data centers like Microsoft's Mount Pleasant facility to be located in eastern Wisconsin or Michigan's Upper Peninsula.

This requirement was rejected by the PSC in May as part of a new rate structure for large data center customers. The commission ultimately sided with ratepayer advocates and clean energy groups, who argued that limiting data centers' access to wind energy would increase costs.

We Energies spokesperson Brendan Conway said the utility will follow the PSC's order while working with the commission to resolve the discrepancy. Microsoft has already signed a contract with We Energies, but will be held to the PSC-approved rules, which allow data centers to subscribe to plants outside of eastern Wisconsin and the Upper Peninsula.

The issue highlights concerns about outdated contracts and the potential for utilities to prioritize their own interests over those of ratepayers. Ratepayer advocates wonder why We Energies asked Microsoft to sign an outdated version of the contract in the first place, given that the PSC had already approved changes to the rate structure.