Wisconsin Electric works deal to keep running Presque Isle plant

Due to a near-term lack of power demand, Wisconsin Electric Power has looked at shutting its coal-fired Presque Isle power plant in Michigan’s Upper Peninsula, but the Midcontinent ISO has decided the plant is needed for grid support.

“We are in discussions with MISO to determine the compensation the company would receive for continued operation of the plant,” said utility spokesman Brian Manthey in an Oct. 22 e-mail to GenerationHub. “Unless an alternative to continuing operations at the plant emerges, we expect to operate all five units in 2014 under the terms of an agreement with MISO. The longer term future of the plant remains unclear. We will continue discussions with Wolverine Power and state regulators regarding possible changes to the joint agreement that could extend the life of the plant.”

Wisconsin Electric and Michigan-based Wolverine Power Supply Cooperative have in recent months been nailing down state commission approvals and needed permits related to a plan by Wolverine to buy one third of Presque Isle in exchange for Wolverine paying for needed air emissions controls. The plant is facing an April 2015 compliance deadline under the federal Mercury and Air Toxics Standards, though Manthey noted a one-year extension on that deadline is possible.

There have been reports that Wolverine may now buy all of the plant to serve its own load needs. Manthey said Wisconsin Electric is open to all options – including selling all of the plant to Wolverine.

Presque Isle Units 1 and 2 were retired in January 2007, and Units 3 and 4 were retired in October 2009. What’s left in operation are: Units 5 and 6, which each have 80 MW of capacity on bituminous coal and 55 MW on sub-bituminous coal; and Units 7-9, each with a range of 78 MW to 85 MW in capacity.

U.S. Energy Information Administration data shows deliveries to the Presque Isle plant earlier this year from the Spring Creek mine in the Montana Powder River Basin of Cloud Peak Energy (NYSE: CLD), and also the North Antelope Rochelle mine of Peabody Energy (NYSE: BTU) and the Black Thunder mine of Arch Coal (NYSE: ACI) in the Wyoming end of the PRB.

Pleasant Prairie power plant getting a refined coal project

In another coal plant development, Manthey said that Wisconsin Electric Power has applied for an air construction permit from the Wisconsin Department of Natural Resources and is in the process of securing local permits for the addition of a refined coal facility at its Pleasant Prairie power plant. The addition of the refined coal process is expected to reduce operating costs at the plant and, ultimately, costs for customers. The proposed process mixes coal with two reagents known as MerSorb, a liquid comprised of calcium bromide, and S-Sorb, a solid that is comprised of by-products of the cement industry.

If permitting proceeds as planned for Pleasant Prairie, construction would begin later this year, with operations beginning in the first half of 2014. The facility would be built, owned and operated by a subsidiary of Detroit-based DTE Energy (NYSE: DTE), which has installed seven similar facilities at other generating sites, Manthey noted.

Pleasant Prairie is a two-unit, 1,190-MW (net) plant that is designed specifically to burn low-sulfur Western coal. It is the first power plant in Wisconsin to be retrofitted with an advanced Air Quality Control System (AQCS) to reduce NOx and SO2 emissions.

Wisconsin Electric Power is a unit of Wisconsin Energy (NYSE: WEC).

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.