Indiana commission rejects protest related to Cook nuclear project

The Indiana Utility Regulatory Commission has turned back a protest related to its July 17 approval of new life cycle investments by Indiana Michigan Power (I&M) at its Donald C Cook nuclear power plant.

On Aug. 5, the Indiana Michigan Power Industrial Group (I&M IG) filed a petition for reconsideration of the July 17 decision, with the Citizens Action Coalition (CAC) then joining in. I&M is a unit of American Electric Power (NYSE: AEP) that operates in both Indiana and the southeast corner of Michigan.

I&M IG had requested that the commission reconsider its final order as it relates to an independent expert monitor. I&M IG argued that because the cost of the expert monitor will be paid for by ratepayers, the consumer parties to this proceeding should exercise exclusive control over the monitor’s work. Specifically, the expert monitor should report exclusively to the Office of Utility Consumer Counselor (OUCC), and the OUCC should be given sole control and direction over the monitor’s work.

In addition, the group said the commission should designate testimonial technical staff and only that staff from the commission should have access to information received from the expert monitor. I&M IG argues that I&M should not be given any authority over the expert monitor because such influence would impair the monitor’s independence.

Initially, I&M argued that the motion should be denied because it amounts to a new request and argument not previously presented to the commission. Even if the commission considers the motion, the July 17 order expressed the commission’s preference for “parallel treatment” on this issue with the Michigan Public Service Commission (MPSC). I&M further argued that having the expert monitor report to the OUCC without any involvement from I&M would be costly, inefficient, and unduly burdensome because I&M would be required to hire two monitors for the Cook plant Life Cycle Management Project. Further, I&M asserted that the system or process directed in the order is reasonable and similar to what other state commissions have ordered.

In its Sept. 19 decision on this matter, the Indiana commission said it established a process that was designed to parallel the approach of the MPSC, which would provide for cost and other efficiencies in monitoring the progress of the LCM Project and offer information in an open and transparent manner. So the Indiana commission denied the request, but said that further clarification of the process established in the July 17 order should be provided.

“As set forth in our Order, the independent expert monitor is to be retained by I&M,” the commission wrote. “We do not view this fact to be synonymous with I&M having unreasonable discriminatory control over the independent expert monitor’s update reports. We note that the ultimate recovery of the independent expert monitor cost from Indiana ratepayers carries a reasonableness requirement. At a minimum, we expect that the independent expert monitor would sponsor its update report in the LCM Rider proceedings and would be available for purposes of discovery and cross-examination at the evidentiary hearing. Similarly, we fully expect the update reports to contain the monitor’s review of both I&M’s progress on the LCM Project and the information provided to the Commission by I&M in the LCM Rider proceedings. Accordingly, any control I&M may attain in providing the efficient contractual retention of an expert can be balanced with the public interest of the Commission’s intended independent monitoring of the LCM Project.”

The July 17 order approved a nearly $1.2bn upgrade project at the Donald C. Cook nuclear plant – but disallowed spending on projects that could lead to an eventual plant uprate. I&M’s petition explained that life cycle management for a nuclear power plant consists of the integration of aging management and economic planning to:

  • optimize the operation, maintenance, and service life of systems, structures and components;
  • maintain an acceptable level of performance and safety; and
  • maximize return on investment over the service life of the plant.

The project consists of sub-projects requiring significant capital investment (along with associated operating and maintenance expenses) intended to fulfill the extended operating licenses of Units 1 and 2 by:

  • safely and reliably extending the operating lives of the units consistent with their operating licenses (i.e., until 2034 and 2037, respectively);
  • increasing the safety and reliability of these units; and
  • also preserving the option for a potential future increase in the electric output of these units through a potential future “capacity uprate.”
About Barry Cassell 20414 Articles
Barry Cassell is Chief Analyst for GenerationHub covering coal and emission controls issues, projects and policy. He has covered the coal and power generation industry for more than 24 years, beginning in November 2011 at GenerationHub and prior to that as editor of SNL Energy’s Coal Report. He was formerly with Coal Outlook for 15 years as the publication’s editor and contributing writer, and prior to that he was editor of Coal & Synfuels Technology and associate editor of The Energy Report. He has a bachelor’s degree from Central Michigan University.