PSC approves MG&E commercial EV charging allowance pilot with conditions and future review

Madison — The Public Service Commission on June 12 approved Madison Gas and Electric’s commercial electric vehicle charging allowance pilot, a budget-funded pilot that gives commercial customers a flat per-added-kilowatt rebate to lower upfront make‑ready costs, but the commission attached reporting, accounting and future rate-case conditions to guard against cross-subsidization.

The pilot is designed so participating customers remain on their underlying CG-2, CG-4 and CG-6 tariffs while the program budget — not a new rate — funds flat, per‑kW rebates for customer‑owned make‑ready equipment and potentially for charging equipment. Commissioner Christian Nieto, who led the discussion, said she would “be voting to approve the program but with conditions and reporting requirements to ensure no cross subsidization occurs.”

The commission’s concern centered on ensuring nonparticipating ratepayers are held harmless. Commissioners agreed the program’s budget design could produce system benefits if incremental EV load increases sales and spreads fixed costs, but several members said MG&E’s application lacked robust upfront analysis proving that assertion. Nieto said she “would have liked to see more robust analysis” and pushed for a mandated system benefit or cost‑benefit analysis to be provided in later proceedings.

Commissioners debated specific guardrails. Some favored a “holdback” mechanism to ensure allowances are earned as usage materializes; others opposed an administratively heavy “clawback.” Patricia Hawkins, speaking as Commissioner Hawkins, urged detailed reporting requirements, proposing modifications to require per‑project tracking so the commission can compare individual project costs with the allowance paid. Hawkins asked staff to require reporting of energy delivered by peak period and revenues tied to customer maximum kilowatt charges to support future cost‑benefit analysis.

On accounting and recoverability, the commission accepted staff proposals to defer the pilot costs for later review in a future rate case rather than include amounts in the currently pending rate case. Commissioners requested that, when the utility seeks recovery of deferred amounts, MG&E provide options for programmatic cost assignment for the commission to consider — including the option of direct assignment to participating customers going forward (not retroactively).

The commission also considered whether any waivers of administrative rules were needed. Commissioners concluded that the program, as designed, is not a distribution extension and that many waiver questions depend on the program’s final form; staff and the applicant were directed to work together to identify any waivers and to delegate waiver decisions to the appropriate administrator for advice and consent.

Legal counsel and staff will work with MG&E to finalize a set of reporting items and accounting orders capturing the conditions discussed. The commission voted to approve the tariff consistent with that discussion; the motion passed on a voice vote with commissioners indicating their support.

The action does not itself establish cost recovery; commissioners explicitly required reporting, system benefit or cost‑benefit analysis and future rate‑case review before any deferred amounts are included in rates.