Despite industry ties, Wisconsin’s top utility regulator vows independence, public involvement
Rebecca Valcq wants you to get excited about energy.
An industry insider, the new chairwoman of the Wisconsin Public Service Commission says she would like to demystify the utility regulation process and encourage more public engagement.
“It’s really interesting, and it impacts everybody,” Valcq said in an interview with the Wisconsin State Journal. “Whatever walk of life, whatever socioeconomic background you have, whatever career path you choose, you are impacted by energy — every day.”
Valcq, who takes over leadership of the state’s utility regulatory agency Saturday, has spent most of her career with the state’s largest investor-owned utility and serves at the pleasure of a Democratic governor committed to stronger environmental regulation and renewable energy.
But she insists she no longer works for utilities, and state law limits the commission’s ability to enact policies favored by the governor.
As the regulator of the state’s utility companies, the PSC was established in 1907 to ensure that, in the absence of competition, utilities provide “adequate and reasonably priced service” to their customers.
But that mission is inherently conflicted.
Unlike a pure consumer protection agency, the PSC must set rates that guarantee utilities enough profit to encourage them to make investments in the plants, wires and pipes needed to ensure reliable service.
And there are bigger questions looming, such as how to pay for billions of dollars’ worth of coal-fired generators as utilities pivot toward cheaper and cleaner alternatives, who should be allowed to own solar panels, and how electric vehicles could reshape the utility landscape.
Valcq also wants to address gaps in broadband Internet service. Gov. Tony Evers has proposed spending $78 million to ensure statewide coverage.
“This is a huge issue facing the state,” she said. “I don’t know that just continuing to do what we’ve done over the last couple of years is going to get us to that final step.”
Valcq (her name rhymes with “rock”) is the first Democratic appointee to head the commission since 2011. Her fellow commissioners, Mike Huebsch and Ellen Nowak, were appointed by former Gov. Scott Walker; their terms expire in 2021 and 2023.
Nowak, the last chairwoman, said while commissioners sometimes have philosophical differences — such as the role of government — the majority of the commission’s work is nonpartisan.
“You don’t vote on something because you feel a certain way,” she said. “You vote on something because there’s evidence.”
Valcq, 43, has spent the majority of her career as an attorney for the WEC Energy Group, the parent company of the state’s largest utility, We Energies.
That industry connection worried some ratepayer advocates, but consumer groups say they are optimistic that Valcq will be an independent regulator.
“We had some concerns about somebody who had represented … the utility side of things and whether they would be working on behalf of customers,” said Tom Content, executive director of the Citizens Utility Board, which represents residential and small-business ratepayers. “Clearly she signaled that she was going to have an open mind and reach out to a variety of stakeholders, and it appears that’s what she wants to do.”
The Wisconsin Industrial Energy Group, which represents the state’s largest electric customers, said Valcq comes to the job with “enormous knowledge” of the industry and challenges — including electricity rates that are the second-highest in the Midwest.
“All the interactions we’ve had so far with her have been positive,” said executive director Todd Stuart. “We’re looking forward to working with her to help us navigate our state’s very complicated energy future.”
Phil Montgomery, a former legislator who chaired the commission during former Gov. Scott Walker’s administration, commended Evers for his nomination, saying Valcq’s training and experience working for utilities make her ideally suited to the job.
“This is not an on-the-job appointment,” he said. “You have to have a fundamental knowledge of the markets and the engineering and everything that’s going on.”
Valcq said her industry background helps her understand the issues and shape her questions.
“I understand the impact,” she said. “When the commission issues a decision, I understand how that decision makes its way, ultimately, to the customer.”
Valcq has agreed to recuse herself from 28 open cases as well as any new ones filed this year that she worked on prior to joining the commission.
The commission has already considered one case in which her former law firm, Quarles & Brady, argued on behalf of the Wisconsin Utilities Association against a request by solar developer SunRun to lease solar panels to its customers.
Valcq went against her former employer in voting to hear the case — though the vote did not address the substance of the request.
Valcq objects to the notion that the PSC has been too deferential to the utilities it regulates.
“I think the misconception is that the commission should say no for the sake of saying no,” she said. “Sometimes the commission is in a position to develop a really robust record and ask a lot of really deep questions, but not a lot of people see that.”
‘Light went off’
The granddaughter of Mexican immigrants, Valcq is one of a handful of women to serve in the commission’s 112-year history and the first Latina.
She grew up in the Milwaukee suburb of Greendale. Her father was an attorney. Her mother, Maria Monreal-Cameron, was the longtime head of the Wisconsin Hispanic Chamber of Commerce.
After graduating from Drake University, Valcq enrolled at Marquette University’s law school with the intention of joining the Federal Bureau of Investigation. But an internship with Wisconsin Electric changed all that.
“I went in thinking it was esoteric. I would flip the light switch and just think, ‘Oh that’s magic,’” she said. “Then actually being able to talk to people who worked in the power plants and people who traded energy … it was like literally the light went off in my head. This is really, really cool.”
Valcq hopes to turn the PSC in a more investigative direction, opening generic dockets to study issues, and hearing oral arguments so that the commissioners — who cannot talk about cases outside of open meetings — have a chance to ask questions and see how their colleagues are thinking.
She also wants more opportunity for public engagement.
“Diversity of thought is so critical,” she said. “The more information you have, I think you have a better chance of ending up with a well-reasoned decision.”
Valcq often adds the phrase “environmentally responsible” to the PSC’s mission of ensuring “safe, reliable and affordable” utility service.
In a budget proposal unveiled Thursday, Evers proposed requiring all of Wisconsin’s electricity be carbon-free by 2050, a more aggressive reduction of greenhouse gases than most investor-owned utilities have proposed.
Such action would have to come from the Legislature, as the PSC lacks the authority to mandate renewable energy. As it is, economic factors — not regulatory pressure — are driving utilities to embrace renewable energy like never before. The state’s largest investor-owned utilities have plans to cut carbon emissions 80 percent or more.
It will be up to the PSC to determine where and how new renewable facilities are built and to ensure customers aren’t saddled with the costs of coal-fired plants that are increasingly expensive to operate but have yet to be paid off.
“There are facilities that are still on the books that need to be retired,” Valcq said. “In order for that transition to occur, it’s going to take — I think it’s going to take a little creativity.”