Licensing and Regulatory Affairs Michigan issued the following announcement on Oct. 29.
The Michigan Public Service Commission approved Consumers Energy Co.’s reconciliation of its power supply cost recovery (PSCR) expenses and revenues for the 2018 calendar year but disallowed costs associated with two power plant shutdowns that the company had asked to recoup (Case No. U-20202).
Consumers sought to recover about $2.6 million in replacement power costs incurred during an unplanned 20-day shutdown of its Karn power plant in Essexville in fall 2018 involving the replacement of batteries at the plant. During the shutdown, Consumers also performed other maintenance work that would prevent other future outages, avoiding power replacement costs of $966,000 for 20 days of separate shutdowns that the maintenance work would have otherwise required.
The Commission disallowed the $2.6 million, minus the $966,000 in avoided costs associated with additional maintenance. The Commission expressed concern about flaws in Consumers’ processes and procedures for plant modifications, given shortcomings that led to the outage as outlined in the company’s root-cause analysis of the incident.
Similarly, the Commission disallowed $47,028 in replacement power costs Consumers had sought to recoup for two outages at its Zeeland Unit 2 plant in January 2018 because low-pressure events led to inadequate supply of natural gas. The Commission noted that Consumers had dealt with low-pressure situations for a number of years at the plant and should have remedied the issue sooner. The Commission also directed Consumers to include in its next five-year PSCR plan language to evaluate fuel arrangements for cost-efficient, reliable operation of the Zeeland plant and other gas plants.
The Commission, meanwhile, approved cost recovery of $14,045,520 for biomass merchant plants Cadillac Renewable Energy LLC; Genesee Power Station LP; Grayling Generating Station LP; Hillman Power Company LLC; TES Filer City Station LP; Viking Energy of Lincoln Inc., and Viking Energy of McBain Inc., plus $1,558,135 in uncapped environmental costs for TES Filer City.
In addition to these biomass merchant plants, intervenors in the case included the Michigan Department of Attorney General; the Association of Businesses Advocating Tariff Equity; Midland Cogeneration Venture Limited, and the Residential Customer Group. MPSC Staff also participated.
Original source can be found here.
Source: Licensing and Regulatory Affairs Michigan
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