Responding to a 2014 law out of the state legislature, the West Virginia Public Service Commission on March 19 issued an order saying that all electric utilities serving the state have to file an integrated resource plan (IRP) with the commission by Jan. 1, 2016.
“Many state utility commissions already require some form of integrated resource planning to be filed formally by electric utilities,” the order noted. “At least one electric utility in West Virginia is required currently to file an integrated resource plan in another state. Electric utilities in West Virginia may file plans similar to plans filed in other states as long as those plans include, at a minimum, the information required in this Order. The Commission has intentionally limited the guidelines to assist electric utilities with the initial filings.
“Final Clean Power Plan Rules being issued later this year by the United States Environmental Protection Agency (EPA) [under] the Clean Air Act may necessitate modifications to IRPs. The Commission may issue a further order requiring additional information of operational plans in light of those rules or require a timely supplemental filing following the initial IRP required in this Order.”
West Virginia is heavily reliant on coal-fired power and the CO2-reducing Clean Power Plan, due to be issued in final form this summer, would likely shut a significant amount of that coal capacity.
The IRPs need to include things like a three-year historical record and a minimum ten-year forecast of the utility’s native load peak demand and energy requirements, and other system capacity or firm energy obligations, if applicable. In addition, there should be a minimum ten-year forecast of the supply-side and demand-side resources expected to satisfy those loads. Peak demand should be presented based on peak demand during the PJM Interconnection peak demand period and peak demand for the utility if that occurs at a different time.
Every electric utility serving retail customers and operating in West Virginia is required to file this IRP. Primary electric utilities in West Virginia include the Appalachian Power and Wheeling Power subsidiaries of American Electric Power (NYSE: AEP), and the Monongahela Power and Potomac Edison units of FirstEnergy (NYSE: FE). Wheeling Power was traditionally just a wires company with no generating assets, but it was recently approved by the PSC to acquire half of the coal-fired Mitchell plant from another subsidiary of AEP.