MISO asks federal commission to let it drop Presque Isle SSR deal

The City of Mackinac Island and the Michigan Public Service Commission on Feb. 18 filed comments at the Federal Energy Regulatory Commission on a recent petition by two iron ore mining companies to get the Midcontinent ISO to drop life-support payments for the Presque Isle coal plant.

Tilden Mining and Empire Iron Mining Partnership said in a Feb. 2 request that since the Presque Isle Power Plant (PIPP) is to be sold by Wisconsin Electric Power to Upper Peninsula Power Co. (UPPCo), which will continue to operate PIPP through its anticipated retirement in 2020, and fact that the iron companies are returning to bundled distribution and retail electric power supply service from Wisconsin Electric Power (WEPCO), the commission should make clear that a sytem support resource (SSR) agreement is no longer needed to support the plant. MISO has lately offered SSR payments, which is money raised from regional parties, to Wisconsin Electric to keep PIPP out of retirement and supporting local grid stability.

The City of Mackinac Island said in Feb. 18 comments supporting the iron ore companies: “The sale of the PIPP to UPPCo, which will continue to operate PIPP through its anticipated retirement in 2020, and the return of the Mines to bundled distribution and retail electric power supply service from WEPCo, confirm that WEPCO has not made a definitive decision to retire the Presque Isle Power Plant and, therefore, is not entitled to an SSR Agreement under the terms of MISO’s tariff.”

The Michigan PSC noted in its Feb. 18 comments that on Feb. 10 it ordered Wisconsin Electric into a show cause proceeding on the issue of whether WEPCo, as a retail service provider in Michigan, can fulfill its obligations to serve its customers, including the mines, if the Presque Isle units are retired or suspended. Wisconsin Electric’s own direct testimony in another case raised serious questions about the utility’s ability to serve the needs of customers in the Upper Peninsula. Due to these concerns, the Michigan PSC ordered WEPCo to show cause over the next few weeks of proceedings why WEPCo should not be prohibited from suspending operation of or retiring the Presque Isle Power Plant.

“Regardless of the outcome of the Michigan PSC proceeding, the announcement by the Mines of their election to return to WEPCo as their retail supplier is evidence relevant to the issue of whether the Presque Isle generation units are eligible for SSR treatment under the MISO tariff and should be considered by the Commission in ruling on the Mines’ motion,” the PSC added.

Said the Feb. 2 motion from Tilden and Empire: “This pleading formally advises the Commission that, effective February 1, 2015, the Mines returned to bundled distribution and power supply retail electric service from WEPCo. Accordingly, WEPCo’s claimed justification for the PIPP SSR Agreements no longer exists. The Mines therefore MOVE the Commission to terminate the second PIPP SSR Agreement, effective no later than February 1, 2015, as moot.” They pointed out that it was the original loss of their load that helped propel WEPCO’s retirement decision for this power plant in the first place.

MISO made these arguments something of a moot point with a Feb. 18 filing at FERC that said: “On February 17, 2015, Wisconsin Electric notified MISO that it sought to rescind its Attachment Y Notice of retirement for PIPP and continue the SSR Units in commercial operation such that the PIPP continues to support reliability in the area of its operation. The notice asks that the rescission be effective on February 1, 2015 (i.e. last day for the SSR status would be January 31, 2015).

“MISO has determined that rescission of the Attachment Y Notice means that PIPP is not required to serve in a SSR status. The Tariff provision covering such a situation, Section 38.2.7 (‘Modification of an Attachment Y Notice,’ ‘Modification of an Attachment Y Notice After Commencing a Suspension, Retirement, or an SSR Agreement’) provides that MISO terminate the Retirement SSR Agreement following receipt of a notice of rescission. In considering the termination, and especially the request by Wisconsin Electric that it be effective February 1, 2015, MISO seeks waiver (to the extent necessary) to effectively terminate the Retirement SSR Agreement and provide for an orderly transition of the early termination.”

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.