Public Service Commission grants Oak Creek 
CPCN for about 1,100 MW gas-fired plant; opens cost-overrun investigation

The Public Service Commission on May 22, 2025, voted to grant Wisconsin Electric Power Company a certificate of public convenience and necessity (CPCN) to build the Oak Creek CT project — a proposal of five combustion-turbine generators, each with a nominal 220-megawatt capacity for a total of about 1,100 megawatts — subject to project-specific conditions and new reporting requirements.

The commission said the project is intended to address significant near-term load growth in southeastern Wisconsin and provide dispatchable, on-demand generation to complement intermittent renewable resources. Chairperson Strand said the record and modeling work demonstrated need and that, with conditions, the project meets statutory criteria for a CPCN. The commission also voted to open a generic investigation into cost overruns affecting major construction projects.

Why it matters: Commissioners framed the decision around reliability, near-term forecasted load growth in the I‑94 corridor, and the need for dispatchable generation that can run when renewables cannot. The project drew heavy public participation, extensive intervenor testimony, and detailed modeling and environmental review. The DNR-PSC environmental review concluded the proposal could be permitted and noted that, with the retirement of existing Oak Creek coal units and proposed emission limits, regulated emissions from the site would decrease.

Most important facts

- Proposal: the Oak Creek CT (OCCT) project consists of five combustion-turbine generators, each having a nominal 220 MW capacity (approximately 1,100 MW total). Chairperson Strand summarized the proposal and the procedural history, including notice of proceeding issued Aug. 15, 2024.

- Record and public participation: PSC staff and interveners undertook modeling, environmental assessments and numerous data requests; the docket included public hearings and 553 written public comments filed through the PSC website. Interveners in the proceeding included Citizens Utility Board, Clean Wisconsin, Sierra Club, Renew Wisconsin, Walnut Way Conservation Corps, the Union of Concerned Scientists and several others.

- Commission findings: Commissioners concluded, after reviewing the record and modeling sensitivities, that the project satisfies the statutory tests for a CPCN (need, public interest, energy-priority law alternatives, impacts on applicant service efficiency and land-use). The commission found the project was routinely selected in the applicant’s portfolio modeling and that other alternatives were not shown to be cost‑effective, technically feasible, and environmentally preferable in the relevant timeframes.

- Environmental review: PSC staff and DNR prepared an environmental assessment. The record states staff did not identify potential environmental effects considered significant and that the project—combined with the permanent shutdown of existing Oak Creek coal-fired units—would result in “significant permanent reductions to emissions from the Oak Creek Power Plant,” according to the environmental assessment included in the record.

- Conditions adopted and reporting requirements: The commission attached multiple conditions to the approval. Key condition and reporting decisions include: - A strict notification and reporting regime for potential cost increases and overruns: if the project cost (excluding AFUDC) may be exceeded, the applicant must notify the commission within 30 days of discovery and "itemize and segregate those costs by major accounts and provide sufficient documentation to support and explain the reasons for such deviations." Chairperson Strand said the documentation must be “forthcoming, substantive, thorough, and detailed.” - The commission declined to adopt the applicant’s proposed 10% tolerance band and instead retained a hard-cap/notification practice the commission has used since 2023. - The commission will require the applicant to notify the PSC within 30 days if a very large customer’s load forecast “significantly decreases,” and to trigger the customer-protection mechanisms described in testimony and approved tariffs. - The commission included standard construction conditions but modified them for this docket: it removed a standard condition applicable to merchant developers (romanette 6), retained quarterly labor-reporting requirements (romanette 9 subitems 5–7), and kept a “line-of-sight” mitigation requirement but modified it to require mitigation only “to the extent practicable.” - The commission directed the applicant to incorporate competitive bid reporting into quarterly reports where applicable. - The commission accepted a commissioner-proposed requirement that the applicant include a plan to pursue additional demand-response opportunities in its next rate proceeding, and reserved judgment on the specifics until that filing.

- Generic investigation: Chairperson Strand proposed and the commission authorized opening a generic investigation into cost-overrun causes, management, mitigation and prevention strategies. Strand said, “I am going to propose that the commission open an investigation on the cost overrun topic,” and described a scope that would include causes, frequency, contract provisions (including force majeure), monitoring, and study of how other states handle the issue. Commissioners said the investigation would be prioritized by staff and that, in the interim, staff would continue to collect project‑specific information and issue data requests as needed.

Record excerpts and attribution

Chairperson Strand: “I am going to propose that the commission open an investigation on the cost overrun topic.” Chairperson Strand also described the reporting expectation: the applicant must provide “sufficient documentation to support and explain the reasons” for any cost deviations.

Commissioner Nieto: supported the approach of spreading project benefits and the demand-response follow-up requirement in a future rate case.

Commissioner Hawkins: emphasized reliability as the primary standard and said the commission must protect ratepayers by ensuring utilities plan sufficient resources.

What the commission did not do

- The commission did not adopt several intervener-proposed prescriptive measures that the commissioners judged legally or procedurally premature for a single CPCN order (for example, certain detailed change-order approvals or prescriptive force‑majeure definitions), and directed those topics into the new generic investigation.

Next steps and implementation

The commission’s written order will set out the detailed conditions and reporting templates. Staff was directed to open the generic investigation and prepare a scoping memo for the commission’s consideration. The motion to grant the CPCN and the related conditions passed unanimously. The PSC recorded the motion on docket 6630CU317.

Ending

The commission’s approval allows the applicant to proceed under the terms and conditions adopted today; staff and interveners will remain engaged through the reporting and investigation process as the project progresses.