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Released November 20, 2023 | SUGAR LAND
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Written by John Egan for Industrial Info Resources (Sugar Land, Texas)--Over the next five years, WEC Energy Group Incorporated (NYSE:WEC) (Milwaukee, Wisconsin) plans to sharply increase its capital spending for electric generation in Wisconsin and Michigan, utility officials told investors this month. Overall, WEC's capital expenditures (CAPEX) for the five-year period 2024-2028 is expected to rise about $3.3 billion, to approximately $23.4 billion from roughly $20.1 billion for the 2023-2027 period, the utility said in a November 9 investor presentation.
Click on the image at right to see a comparison of WEC's five-year capital spending programs for 2023-2027 and 2024-2028.
Company officials also spoke at last week's Edison Electric Institute's annual financial conference in Phoenix, where they discussed the utility's planned capital spending and business outlook with investors, analysts and bankers. WEC is a holding company for electric and gas operating utilities in Wisconsin, Minnesota, Michigan and Illinois that serve about 4.6 million customers. It also owns 60% of American Transmission Company LLC (ATC) (Pewaukee, Wisconsin), a merchant electric transmission company that owns and operates more than 10,000 miles of transmission lines in the Upper Midwest.
Industrial Info is tracking 11 capital projects involving WEC that total about $802 million. Subscribers to Industrial Info's Global Market Intelligence (GMI) Power Project Database can click here for a list of detailed project reports.
About $2.9 billion of the $3.3 billion increase in capital spending will go to electric generation in the company's Wisconsin and Michigan service areas. Annual investment in generation in those two states is scheduled to rise from slightly more than $1 billion in 2023 to $1.6 billion in 2025 and $2.2 billion in 2027 and 2028.
Click on the image at right to see a breakout, by year and function, for WEC's capital spending program.
Company officials told investors it was investing in efficiency, sustainability and growth. They said the company's increase in CAPEX was driven by solid economic growth in Wisconsin, new transmission assets to ensure reliability, seasonal capacity rules implemented by the Midcontinent Independent System Operator (MISO) (Carmel, Indiana) and continued hardening of its distribution networks.
WEC plans to more than double its annual investments in its ATC unit, to a peak of about $712 million in 2027 from approximately $311 million in 2023.
Click on the image at right to see ATC's planned growth in capital investments, and WEC's 60% share of those outlays.
WEC has worked aggressively to lower its carbon footprint in recent years. For more on that, see December 27, 2022, article - WEC Energy Details a Surge in Planned Spending on Its Version of ESG. Over the 2024-2028 period, it plans to invest about $6.8 billion in regulated renewable energy assets. Roughly $4.5 billion of that sum is scheduled to be used to grow the company's solar power portfolio by about 2,700 megawatts (MW). Wind power assets will grow by about 880 MW over that time, at a cost of about $1.9 billion. WEC also envisions investing about $400 million to bring on approximately 250 MW of battery energy storage over the next five years.
By 2030, about 34% of WEC's electricity will come from renewables, up from about 8% currently. The company plans to exit entirely from coal by 2032, three years earlier than it previously planned. By 2030, however, it sees coal being used sparingly. As recently as 2005, nearly three-quarters of WEC's electricity was generated from coal.
Click on the image at right to see WEC's evolving fuel mix.
To decarbonize its electricity, WEC plans to close several coal-fired units and convert others to burn natural gas. The scheduled coal unit retirements include:
More efficient gas-fired generation also will be constructed at several locations over the 2024-2028 period, company officials said. It is considering adding 100 MW of gas-fired capacity at its West Riverside Energy Center next year, a $100 million project. In addition, it plans to add roughly 1,125 MW of combustion turbine generation capacity, at a cost of approximately $1.2 billion. Lastly, WEC expects to invest about $211 million to expand its reciprocating internal combustion engine (RICE) generation capacity by roughly 132 MW.
The company also is building two liquefied natural gas (LNG) storage tanks to ensure adequacy of supply during the region's bitter cold winters.
All these capital investments will enable WEC to continue shrinking its carbon footprint. Currently, it is about halfway to achieving net-zero carbon emissions by 2050.
Click on the image at right to see a chart of WEC's progress to net-zero carbon emissions by 2050.
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking over 200,000 current and future projects worth $17.8 Trillion (USD).
Company officials also spoke at last week's Edison Electric Institute's annual financial conference in Phoenix, where they discussed the utility's planned capital spending and business outlook with investors, analysts and bankers. WEC is a holding company for electric and gas operating utilities in Wisconsin, Minnesota, Michigan and Illinois that serve about 4.6 million customers. It also owns 60% of American Transmission Company LLC (ATC) (Pewaukee, Wisconsin), a merchant electric transmission company that owns and operates more than 10,000 miles of transmission lines in the Upper Midwest.
Industrial Info is tracking 11 capital projects involving WEC that total about $802 million. Subscribers to Industrial Info's Global Market Intelligence (GMI) Power Project Database can click here for a list of detailed project reports.
About $2.9 billion of the $3.3 billion increase in capital spending will go to electric generation in the company's Wisconsin and Michigan service areas. Annual investment in generation in those two states is scheduled to rise from slightly more than $1 billion in 2023 to $1.6 billion in 2025 and $2.2 billion in 2027 and 2028.
Company officials told investors it was investing in efficiency, sustainability and growth. They said the company's increase in CAPEX was driven by solid economic growth in Wisconsin, new transmission assets to ensure reliability, seasonal capacity rules implemented by the Midcontinent Independent System Operator (MISO) (Carmel, Indiana) and continued hardening of its distribution networks.
WEC plans to more than double its annual investments in its ATC unit, to a peak of about $712 million in 2027 from approximately $311 million in 2023.
WEC has worked aggressively to lower its carbon footprint in recent years. For more on that, see December 27, 2022, article - WEC Energy Details a Surge in Planned Spending on Its Version of ESG. Over the 2024-2028 period, it plans to invest about $6.8 billion in regulated renewable energy assets. Roughly $4.5 billion of that sum is scheduled to be used to grow the company's solar power portfolio by about 2,700 megawatts (MW). Wind power assets will grow by about 880 MW over that time, at a cost of about $1.9 billion. WEC also envisions investing about $400 million to bring on approximately 250 MW of battery energy storage over the next five years.
By 2030, about 34% of WEC's electricity will come from renewables, up from about 8% currently. The company plans to exit entirely from coal by 2032, three years earlier than it previously planned. By 2030, however, it sees coal being used sparingly. As recently as 2005, nearly three-quarters of WEC's electricity was generated from coal.
To decarbonize its electricity, WEC plans to close several coal-fired units and convert others to burn natural gas. The scheduled coal unit retirements include:
- Oak Creek Units 5-6: 528 MW of capacity (May 2024)
- Oak Creek Units 7-8: 611 MW (late in 2025)
- Columbia Units 1-2: 300 MW (by June 1, 2026)
- Weston Unit 3: 328 MW (end of 2031)
More efficient gas-fired generation also will be constructed at several locations over the 2024-2028 period, company officials said. It is considering adding 100 MW of gas-fired capacity at its West Riverside Energy Center next year, a $100 million project. In addition, it plans to add roughly 1,125 MW of combustion turbine generation capacity, at a cost of approximately $1.2 billion. Lastly, WEC expects to invest about $211 million to expand its reciprocating internal combustion engine (RICE) generation capacity by roughly 132 MW.
The company also is building two liquefied natural gas (LNG) storage tanks to ensure adequacy of supply during the region's bitter cold winters.
All these capital investments will enable WEC to continue shrinking its carbon footprint. Currently, it is about halfway to achieving net-zero carbon emissions by 2050.
Industrial Info Resources (IIR) is the leading provider of industrial market intelligence. Since 1983, IIR has provided comprehensive research, news and analysis on the industrial process, manufacturing and energy related industries. IIR's Global Market Intelligence (GMI) helps companies identify and pursue trends across multiple markets with access to real, qualified and validated plant and project opportunities. Across the world, IIR is tracking over 200,000 current and future projects worth $17.8 Trillion (USD).
