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Michigan still worried about power supply despite Lower Peninsula improvement

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Michigan still worried about power supply despite Lower Peninsula improvement

Aprojected power capacity shortfall in the Lower Peninsula of Michigan appearsto be improving, but there are still concerns the state does not have enoughhomegrown energy to prevent reliability issues, the Michigan Public ServiceCommission said in a July 22 statement.

APSC staff analysis has found that the 2017 capacity shortfall in Zone 7 of theMidcontinent Independent SystemOperator Inc., a zone that covers the majority of the LowerPeninsula, will be 270 MW, down from 520 MW identified by the PSC's analysis in2015. In addition, resources outside the zone will likely be available toimport power into Michigan to close the gap, the analysis said.

"The Commission remains concerned that load servingentities in the Lower Peninsula do not have adequate capacity within the stateto meet reliability requirements," PSC Chairman Sally Talberg said in thestatement.

In aJuly 22 order, the PSC summarized the result of an investigation into theadequacy and reliability of capacity from 2016 to 2020 that is being conductedin docket U-17992. The investigation "shows that the near-termsupply outlook for the summer of 2017 in the Lower Peninsula's Zone 7 isforecasted to improve, despite the unexpected closure of a unit at 's plant in November2015 due to turbine failure," the statement said.

ThePSC also fears the picture could worsen after next year due to a trend of powerplant retirements across the Midwest.

Talberg added that there is uncertainty about whether theseresources outside of the state will continue to be available. "The regionalsupply outlook is important in examining the balance of demand and supplybecause we rely on imports from out of state to meet the minimum reliabilityrequirements," Talberg said.

DTE Electric is owned by DTE Energy Co., which recently that between 2020 and 2023 itwould be retiring eight units at three coal-fired plants that togetherrepresent about a quarter of the company's 2015 electricity generation.

In June, MISO saidthat Exelon Corp.'splanned nuclear plant retirements in Illinois could cause power reserve marginsto fall below minimum levels around 2018.

,another major electric utility in Michigan, said the potential capacityshortfall is a reason to support proposed state legislation that would requireout-of-state energy marketers to plan for firm electric capacity.

"Ifthe out-of-state marketers had planned for their customers and invested in realassets, Michigan would not face a shortfall," Consumers Senior VicePresident of Governmental, Regulatory and Public Affairs David Mengebier wrotein a July 21 opinion piece for TheDetroit News. "If they take responsibility now, it's possible Michigancan manage through this situation. But the bottom line is that the out-of-statemarketers must invest in physical assets here to serve their customers."

Consumersis a subsidiary of CMS EnergyCorp.