Wisconsin Gov. Scott Walker and his so-called budget-repair bill are making news again, this time for a proposal, buried within the legislation, to privatize state-owned power plants, including the troubled ones that provide power on campuses of the University of Wisconsin. Under the language of the bill, those contracts would be offered to companies on a no-bid basis.
The Daily Kos, Politico, and Paul Krugman, the liberal economist and columnist for The New York Times, have all highlighted the passage in the bill that the state “may sell any state-owned heating, cooling, and power plant or may contract with a private entity for the operation of any such plant, with or without solicitation of bids, for any amount that the department determines to be in the best interest of the state.”
Some speculation is that the power plants would be offered to Koch Industries, which is owned by Charles and David Koch, billionaire benefactors of conservative causes. This week David Koch made headlines in the Wisconsin controversy by not doing anything at all. A blogger pretending to be Mr. Koch recorded a phone conversation with Mr. Walker, in which the governor seemed to be cozying up to the billionaire.
But how would a potential privatization affect the operation of the plants? Perhaps not much. Jeff Plale, a former Democratic state senator who is administrator of the Division of State Facilities, played down both the potential for privatization and the controversy around a no-bid acquisition.
“This is the beginning of a very long process. … I don’t think you are going to have a whole lot of people lining up to take them off our hands,” said Mr. Plale, who was hired by Governor Walker in January. The power plants around Wisconsin campuses have been under scrutiny by the U.S Environmental Protection Agency for coal emissions—scrutiny that was prompted when the Sierra Club started investigating the plants.
Would privatizing the power plants make it harder for activists and other groups to review their operation? Mr. Plale said any private operator would be accountable to the state for the price, reliability, and stability of the power. As for their cleanliness, he said, “I don’t think there are any incentives to getting into the cross hairs of the EPA.”
Jennifer Feyerherm, who works in Wisconsin on the Sierra Club’s Beyond Coal campaign, seems to agree. “With the state-owned plants, we’ve had trouble because the [state's Department of Natural Resources] seems to have a hard time enforcing against a sister state agency,” she said. “If they were privately owned, we would have different challenges.”
One thing that has disappointed Ms. Feyerherm and other activists: the fate of Wisconsin’s biomass plan. After the Sierra Club successfully sued the state over coal emissions in 2007, then-Gov. Jim Doyle announced a plan to replace coal with biomass at the plant in Madison that supplies power to the university’s flagship campus. State officials hoped that the conversion would help kick-start a biomass industry in the state.
But the biomass plan was one of the first things that Mr. Walker killed when he took office. The Madison plant will burn natural gas only.
“The biomass plant was an opportunity to invigorate our local economies,” Ms. Feyerherm says. But state officials said it would be too expensive and had a number of difficult logistical challenges, like figuring out how to transport the biomass by train to a busy section of Madison.
Mr. Plale said the biomass plan would have cost $100-million, which was about $75-million more than one using natural gas. He added that university officials were among those happiest with the decision to dump the plan. (Alan Fish, associate vice chancellor for facilities at Madison, did not return a call from The Chronicle.)
To the Sierra Club’s Ms. Feyerherm, expense is all relative. “‘Too expensive’ is the shortsighted way that people are preferring to do their money math,” she said. “It keeps our money local. … We don’t make natural gas.” When the state sent out a call for proposals on fuel streams, she said, “the response was more than they ever guessed—there were lots of folks out there who were offering a variety of fuel streams.”
(Flickr photo of the Madison, Wis., power plant, on Charter Street, by Turbo!!!)
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