{"id":17708,"date":"2025-10-16T22:06:05","date_gmt":"2025-10-16T22:06:05","guid":{"rendered":"https:\/\/wifamily.news\/?p=17708"},"modified":"2025-10-16T22:56:58","modified_gmt":"2025-10-16T22:56:58","slug":"bill-would-use-tax-credit-to-lower-cost-barrier-to-new-nuclear-in-wisconsin","status":"publish","type":"post","link":"https:\/\/wifamily.news\/?p=17708","title":{"rendered":"Bill would use tax credit to lower cost barrier to new nuclear in Wisconsin"},"content":{"rendered":"

This post originally appeared at https:\/\/www.badgerinstitute.org\/bill-would-use-tax-credit-to-lower-cost-barrier-to-new-nuclear-in-wisconsin\/<\/a><\/p>\n

Measure includes shifts in state\u2019s priorities in law for \u2018only way we keep lights on\u2019<\/em><\/h4>\n

Legislation touted by its sponsor as the logical follow-up to a bipartisan law signaling support for new nuclear energy in Wisconsin got its own hearing in front of an Assembly committee this week.<\/p>\n

The new bill, AB472<\/a>, is a grab-bag of measures. A largely supportive train of witnesses offered even-toned objections to differing parts, but opposition was muted at most \u2014 a remarkable development in a state that repealed its moratorium on new nuclear plants only nine years ago<\/a>.<\/p>\n

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The bill, said sponsor Rep. Shae Sortwell (R-Two Rivers), addresses start-up costs, in part by adding a tax credit for the first 19 years of a nuclear power plant\u2019s operation, its value determined by how much power a plant produces.<\/p>\n

Sortwell termed it \u201ca long-term investment in our baseload generating capacity,\u201d referring to the sort of power plant that operates predictably<\/a> at a given output.<\/p>\n

That means nuclear, given federal laws forcing the closure of coal-fired plants and the state\u2019s commitment to reduce carbon emissions. As the sponsor of a Senate version of the bill, Sen. Jesse James (R-Thorp), told the hearing, nuclear plants run \u201cwhen the sun isn\u2019t shining and the wind isn\u2019t blowing.\u201d<\/p>\n

The credit would be a sizeable subsidy: $1.21 for every megawatt-hour of electricity a plant produces in a year for the first 10 years, then phasing down to 12.1 cents per MWh in the 19th<\/sup> year. For a plant producing 10 million MWh, the typical annual output of Wisconsin\u2019s one existing nuclear plant, that would mean a credit up to $12.2 million a year at the outset, $178 million in total.<\/p>\n

Sortwell said he sees the credit as a way for Wisconsin to compete for new nuclear development, including the about-to-start deployment of \u201csmall modular reactors,\u201d when other states are offering up-front subsidies, including loans. The tax credit amounts to giving up a portion \u2014 Sortwell reckons about half \u2014 of tax revenue a new plant generates, revenue the state would not get if a plant isn\u2019t built here.<\/p>\n

\u201cThe government on the whole isn\u2019t losing money,\u201d he said, just taking less than it would otherwise have gotten, assuming the plant was built without the credit.<\/p>\n

Whether a plant would be built without it is in question. Nuclear plants are costly because of regulatory demands that start long before construction begins.<\/p>\n

Electricity rates are set by the state Public Service Commission, which bases them in part on a utility\u2019s costs. One part of the bill would declare that some of the regulatory prep work leading up to filing for approval to start building would count as a \u201crecoverable\u201d cost. Currently, pre-approval costs are not necessarily \u201crecoverable.\u201d<\/p>\n

\u201cUtilities wishing to advance new nuclear construction in our state face a one-way financial risk. We must invest more than $100 million upfront with no assurance that those costs will be recoverable,\u201d Joel M. Haubrich, lobbyist for WEC Energy Group, owner of two utilities, Wisconsin Public Service and We Energies, told the hearing.<\/p>\n

If costs aren\u2019t recoverable, investors take the haircut, and such uncertainty stymies nuclear investment.<\/p>\n

If they are, the tax credit would reduce the sum that ratepayers would have to bear, keeping nuclear\u2019s high regulatory costs from raising existing customers\u2019 bills, Sortwell told the hearing.<\/p>\n

The bill\u2019s other provisions include ones altering lists of energy priorities in state law that enshrine conservation and \u201crenewable\u201d sources, such as wind turbines and solar panels, as top priorities. The bill moves nuclear up to that first tier. It also would alter the state\u2019s requirement that 10 percent of electricity be from \u201crenewable\u201d sources to instead be from \u201clow-carbon-emission\u201d sources that include nuclear.<\/p>\n

The change, said Sortwell, recognizes that if the state government wants to reduce carbon emissions, nuclear power meets the goal as well as solar and wind do. Haubrich put it bluntly: If government policy is to stop emitting carbon, \u201cthe only way we can keep the lights on 24-7 is nuclear.\u201d<\/p>\n

The context includes the surge in proposed data centers<\/a> in Wisconsin \u2014 the physical sites of the internet\u2019s infrastructure, which use vast amounts of power.<\/p>\n

\u201cWhatever my opinion of data centers,\u201d said Sortwell, \u201cthey are coming.\u201d The bill includes a provision to set distinct rates for \u201cvery large\u201d electricity consumers meant to direct the costs of added nuclear generating capacity onto large users and\u00a0 keep it off residential customers.<\/p>\n

Sortwell said he sees the economic payoff not so much in data centers but in the ample, reliable power for any user that a robust nuclear sector would provide \u2014 and the jobs. That includes, he told the hearing before the Committee on Energy and Utilities, \u00a0hope that the industry of factory-built small modular reactors<\/a> would develop in Wisconsin, meaning engineering and skilled manufacturing expertise here rather than elsewhere.<\/p>\n

\u201cThere\u2019s a domino effect of building these SMRs,\u201d he said, arguing that early adoption of the technology would lead to Wisconsin being a home for the industry.<\/p>\n

Patrick McIlheran is the Director of Policy at the Badger Institute.<\/em>\u00a0<\/p>\n

Any<\/em>\u202f<\/em>use or reproduction of Badger Institute articles or photographs requires prior written<\/em>\u202f<\/em>permission.<\/em>\u202f<\/em>To request permission to post articles on a website or print copies for distribution, contact Badger Institute Marketing Director Matt Erdman at<\/em>\u202f<\/em>matt@badgerinstitute.org<\/em><\/a>.<\/em><\/p>\n

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