The Midcontinent ISO (MISO) is anticipating a shortfall of approximately 7,000 MW of generating capacity when coal-fired plants retire to comply with the EPA’s Mercury and Air Toxics Standards (MATS) that take effect in 2016, MISO officials said at the NARUC Summer Committee Meetings in Denver, Colo., July 23.
The current MISO generation stack consists of 85% coal-fired generation, comprising 66,000 MW of coal plants, 48,000 MW of which must take actions to comply with EPA’s MATS rule. Of the remaining 18,000 MW, MISO has already seen 2,000 MW retire, and officials expect another 10,000 MW to retire before the rule takes effect.
“Most of those are old, small plants on the order of 100 MW and many are 60 years old or older, and retrofitting them to meet the new standards doesn’t make sense,” Clair Moeller, MISO’s executive vice president for transmission and technology, said.
MISO strives to maintain resources of approximately 109,000 MW, which includes a 15% reserve margin, he said. Accordingly, the 7,000 lost megawatts will reduce reserves, but officials are hopeful that the loss will not affect the organization’s ability to meet load, “provided everything else is running, and there are no forced outages” or other adverse events, Moeller said.
However, because it is the obligation of the individual states to ensure adequate generation resources, the organization lacks a complete picture of what will be available in terms of generation.
“We have a short-term problem in that we can’t see where the resources are to keep us secure,” Moeller said. “The only thing [participants are obligated] to tell us is when they want to connect new things to the grid.”
To obtain a more complete picture, MISO has engaged with the Organization of MISO States (OMS) to survey the load-serving entities within its footprint and gather detailed information about their plans to ensure resource adequacy.
“One at a time, everybody says, ‘We’re fine’,” Moeller said. “However, the arithmetic keeps coming back 7,000 MW short, so we’re missing data.”
The OMS questionnaire will ask utilities for information about the measures they will take to meet any shortfalls, including demand-side management, conservation measures they will be taking, behind the meter generation they will be calling upon, and planned purchases from neighboring utilities.
“We can get a better answer about how much of that 7,000 MW deficit is real and how much of it is because we can’t see clearly what peoples’ plans are,” Moeller said.
Time is of the essence, he added.
“If you decide today that you want to build a generator, you probably can’t get it done by 2016,” he said, adding that approximately 2,000 MW of gas-fired generation scheduled to enter service in 2017 will still leave the region short for several months after the coal plants retire.
The numbers will change in December when the integration of the Entergy (NYSE:ETR) operating companies into the MISO footprint is complete. In the interim, Moeller said, state regulators have asked that MISO distribute the same questionnaire to its future member companies in the southern region so that, when the integration is completed in December, the necessary data regarding future supply availability will already be in hand.