We Energies says an agreement with Microsoft over electricity rates for large computer data centers planned for southeastern Wisconsin would not financially harm other ratepayers. But that deal, which still needs state approval, is triggering skepticism in parts of Milwaukee, where people face a relatively high financial burden to keep on the heat, lights and, if they have it, air conditioning.
A coalition of groups, which includes several people of color, have been stepping up their criticism of We Energies. The reasons — rate hikes in recent years, plans to build natural gas-fired power plants in Oak Creek and Kenosha County, and on April 15, the return of springtime utility shutoffs due to unpaid bills.
On that Tuesday, Keveia Guiden led a chant of "Power to the people!" for about 20 people at a protest outside a We Energies office at N. 31st St. and North Ave. in Milwaukee.
Also at the rally — Quoita Ivy, who says she grew up in a home where the power was shut off one summer. Ivy, who says she cleans homes or cares for the elderly to help make ends meet, says the energy burden — or percentage of household income spent on energy bills — can be staggering for a low-income person.
“Some people don’t have the money to pay for it. They gotta pay for medicine. They gotta pay for diapers, formula for kids if they’re not on WIC (the nutrition program Women, Infants and Children). There’s just a lot of things. Or life comes up. It’s just, it’s just hard," Ivy tells WUWM.
Ivy’s latest worry — those two natural gas power plants We Energies wants to build. The company says it wants to meet an expected increase in demand for electricity and retire an Oak Creek coal plant along the way. The utility points to energy-gobbling data centers Microsoft is building in Racine County (though part of the project is being paused) and says it wants to build in Kenosha County. Also, a data center a developer is proposing for Port Washington.
Ivy says the average customer shouldn’t be funding those power plants — the computer giants should: “I think if they want it, they should start building it themselves. So, it comes to the point of, what are they doing with their money?”
Montre Moore says even with a bit higher income, he also feels the energy burden. Moore works for an environmental climate justice organization and is on the board of a consumer group, the Citizens Utility Board of Wisconsin. Moore says he pays his own electric and heating bill, and can’t make major changes to achieve energy savings at home.
“I rent, not own. So you have weatherization issues in getting landlords to actually understand how important they are. You know, it’s not affecting their bottom line — it’s affecting mine, as the renter,” Moore says.
As for We Energies wanting new power plants, Moore says, “Wait a minute: We can still rethink some of this and understand there’s opportunity to bring more clean energy to Wisconsin.”
Clean energy — such as solar.
We Energies spokesperson Brendan Conway says his company is adding solar generation in its service area, but needs the natural gas plants, too. Conway promises residential ratepayers would not be affected by a recently announced rate agreement between the utility and big new energy users like Microsoft.
“It is going to be laid out very clearly that these customers will pay for that — even to the point that if they change plans in the future — let’s say they have less growth than they initially planned — they would pay the difference if there was a cost difference. Or, if they were to leave the area — somehow close a plant," Conway says.
Recently, near the cooling water outflow of the We Energies Oak Creek power plant, Citizens Utility Board Executive Director Tom Content met with journalism students from Northwestern University. He raised another concern about the utility’s plans—that due to uncertainty with advances in AI, (artificial intelligence) possibly scaling back data centers, the Milwaukee area could be stuck with with a bigger power plant than it needs, burning an unnecessary amount of polluting natural gas.
“When President Biden was here (in Racine County, in May, 2024) to announce the Microsoft project, he said it was going to be three billion dollars. Well, we don’t know it’s going to be three billion dollars anymore. Based on the pauses in construction, it may be a one billion dollar project. Which is why we’re saying, as a consumer group, we’re saying, yes, build some gas over there, but not to the scale that they want it," Content says.
Content says his group believes We Energies could get by with two new combustion turbines instead of five, and that the utility has overpriced the cost of a battery storage and renewable energy alternative that could shrink the fossil fuel footprint.
The Public Service Commission of Wisconsin (PSC) is expected to rule on the Oak Creek plant, the Kenosha County plant and the Microsoft data center rate deal later this year.
