Wisconsin Administrative Code
Public Service Commission
Chapter PSC 100 - Affiliations between public utilities and other persons
Subchapter II - Affiliated Wholesale Merchant Plant Market Power
Section PSC 100.12 - Definitions

(1) "Affiliated interest" has the meaning set forth in s. 196.52(1), Stats.

(2) "Affiliates" means the public utilities with which the applicant is affiliated and all other affiliated interests of the public utilities.

(3) "Applicant" means any affiliated interest of a public utility seeking approval under s. 196.491(3m), Stats., to own, operate, or control a wholesale merchant plant.

(4) "Available economic capacity" means economic capacity less the amount of generating capacity reasonably necessary to serve, in commercially viable increments, the potential supplier's native load.

(5) "DOJ guidelines" means the U.S. Department of Justice and Federal Trade Commission Horizontal Merger Guidelines, as revised April 8, 1997.

(6) "Economic capacity" means the amount of generating capacity owned or controlled by a potential supplier with variable costs low enough that energy from the capacity could be delivered to the relevant geographic market at a price no more than 5% above the pre-transaction market clearing price; less any capacity that is committed under long-term firm sales contracts; plus any capacity that is acquired under long-term firm purchase contracts, and any generating capacity that is under the operational control of a third-party but the potential supplier receives the economic benefit of the capacity. In this subsection, a long-term sales or purchase contract means a sales or purchase contract which has a remaining commitment of more than one year.

(7) "FERC Order 592" means the December 18, 1996, Federal Energy Regulatory Commission Order 592.

(8) "HHI statistic" means the Herfindahl-Hirschman Index for the market.

(9) "Market power" means the ability of a seller in the relevant geographic market to profitably maintain prices for comparable products above competitive levels for a significant period of time. Sellers with market power also may be able to reduce product quality, quantity, service, or innovation.

(10) "Native load" means load attributable to customers on whose behalf the potential supplier, by statute, franchise, or regulatory requirement, has undertaken an obligation to construct and operate its system to meet their electricity needs.

(11) "Passive investor" is any applicant whose investment the commission determines does not permit control or influence by the affiliated utility of the merchant plant and who receives no more information regarding plant operations, and who receives such information no earlier, than is publicly available to any investor. In making a determination whether an investor may exercise control or influence over a wholesale merchant plant, the commission shall consider, where applicable, such factors as the fiduciary responsibilities of the operator, manager and other investors in the wholesale merchant plant to the investor; the ability of the wholesale merchant plant to raise capital independently of the investor; the ability of the wholesale merchant plant to make investment and financing decisions independently of the investor; governance provisions; the number, identity and interests of other investors; if the investor may exert control or influence over generation rates, terms, conditions and production, including outage schedules; any services that will be provided by the investor or its employees to the wholesale merchant plant; the terms of any agreements between the investor and the wholesale merchant plant, any party managing or operating the wholesale merchant plant, any other investor or lender in the wholesale merchant plant or any purchaser of output from the plant; and any other factors which the commission deems relevant.

(12) "Total capacity" means the total amount of installed electric generating capacity, measured in megawatts, with respective seasonal ratings.

(13) "Wholesale merchant peaker plant" means any wholesale merchant plant anticipated to have an annual capacity factor of less than 10%.

(14) "Wholesale merchant plant" has the meaning set forth in s. 196.491(1) (w), Stats.