The "Clean Power Plan" has two main components: 1) state specific emission rate goals to lower carbon dioxide 

(C02) emissions from power plants using a 2012 baseline; and 2) guidelines to help states develop their plans for 

meeting interim goals starting in 2020 and final goals by 2030 using a series of "building blocks". The building 

blocks (which collectively represent the "best system of emission reductions", according to EPA) include coal 

power plant efficiency improvements, re-dispatch from coal to gas, expanded use of low- and zero-carbon 

generating capacity, and expanded use of demand-side energy efficiency. 

Impact to Wisconsin Energy Corporation 

While we give EPA credit for creativity and believe EPA tried to give states some flexibility, we are very 

concerned about the proposed rule, primarily because EPA failed to adequately account for the emissions 

improvements we've made thus far. While we believe that we are well positioned because of the efficiency of 

our new plants, here are our initial concerns with the EPA proposed rule: 

No Credit for Early Action 

Since 2003, we have invested approximately $9 billion to increase the efficiency at our plants and increase 

the use of renewable energy sources by adding new generation and state-of-the-art emission control 

technology to new and existing units; repowering older, Jess efficient coal plants to combined cycle natural 

gas plants; adding two of the largest wind farms in Wisconsin and a biomass plant; increasing efficiency; and 

investing in distribution upgrades. 

Our actions resulted in a 50% increase in capacity, more than an 80% reduction in 502, NOx, mercury and 

particulate matter, and a reduction in C02 emissions- bringing our GHG emissions level below our 2000 

level. 

EPA's proposed rule does not account for any of the major initiatives we undertook prior to 2012. This could 

result in.stranded costs for our customers for some of our power plant investments. 

2012 Not a Representative Baseline Year 

EPA used 2012 as the baseline year to calculate state specific emission rate goals. However, 2012 is not a 

representative baseline year ... the economy was still recovering and natural gas prices were unusually low 

which resulted in a significant reduction in the use of coal generation. 

Re-dispatch from Coal to Gas 

One ofthe "building blocks" included in EPA's guidelines for states is a re-dispatch from coal to gas units. 

This re-dispatch fundamentally changes the operation of our nation's energy markets- from the current 

practice of dispatching energy based on least cost to what will result in energy based on gas dispatch, 

possibly increasing costs for our customers. 
Impact to State of Wisconsin 

$175-$350 million is the high level annual cost estimate for Wisconsin to implement EPA's four building blocks 

in 2020. This estimate increases to $300-600 million by 2030. 

Wisconsin's 34% Goal Is Above the 30% National Average 

EPA set state specific emission rate goals to lower C02 emissions from power plants. This goal amounts to a 

nationwide average of about a 30% mass reduction from 2005 emission levels by 2030. The goal that EPA 

set for Wisconsin is 4% higher than the nationwide average ... at 34%. 

Building Blocks Could Cost Wisconsin Residents Nearly $300 Million in 2020 

Building Block 1 calls for unit specific efficiency improvements, which EPA estimates will save an average of 

6% across the fleet. Much of the efficiency improvement that EPA proposes is already occurring. Instead, a 

1%-2% efficiency improvement could be technically feasible. EPA also assumes that a 6% efficiency 

improvement can be achieved at a cost of $6-12 per tonne, but utility analysis shows a much higher cost to 

achieve and maintain this level. The high level annual cost estimate for Building Block 1 for Wisconsin is 

$25-75 million. A 2% or lower target would be more technically feasible. 

Building Block 2 calls for a re-dispatch from coal to combined cycle natural gas with a 70% capacity factor. 

Building Blocks 1 and 2 are in conflict ... if companies increase gas plant operations to achieve a 70% capacity 

factor, then presumably the companies would decrease coal plant operations. Coal efficiency improvements 

(Building Block 1) are negated because coal plants are less efficient when they operate less. The high level 

annual cost estimate for Building Block 2 for Wisconsin is $80-170 million for 2020-2029. 

Building Block 3 calls for increased use of low- and zero-carbon generating capacity. It is not clear how 

power purchase agreements for out-of-state projects, including contractually obligated renewable energy 

credits, will be considered. The high level annual cost estimate for Building Block 3 for Wisconsin is 

$15-30 million in 2020, increasing to $150-300 million by 2029, over and above the current Wisconsin energy 

requirement, and assuming the Production Tax Credit is extended. 

Building Block 4 calls for expanded use of demand-side energy efficiency. As required by state law, 

Wisconsin's utilities contribute to Focus on Energy, the statewide energy efficiency and renewable resource 

program. The high level annual cost estimate for Building Block 4 for Wisconsin is $60-65 million for 2020-

2029, over and above the current contributions to Focus on Energy. 

August 2014