MPSC press release announces a request for information from Consumers on termination of its Palisades power purchase agreement.

December 20, 2016

MPSC seeks answers from Consumers on plan to end Palisades power purchase agreement early.

LANSING, Mich. – The Michigan Public Service Commission (MPSC) today said it is seeking additional information on Consumers Energy’s announcement that it intends to terminate early its power purchase agreement (PPA) with Entergy Nuclear Palisades, LLC (ENP) for the purchase of electricity from the Palisades Nuclear Power Plant.

Under the PPA approved by the MPSC in 2007, the utility purchases nearly all of Palisades’ electricity generation. The PPA term runs through April 11, 2022. Consumers Energy seeks to terminate the PPA as of May 31, 2018, at which time ENP will enter into a new PPA under which the plant will continue to operate until Oct. 1, 2018, when Entergy said it intends to close the plant permanently.

The Commission today is initiating a proceeding to receive information that it will need to begin evaluating Consumers Energy’s plan. The Commission recently received guidance from the Michigan House of Representatives on this matter in the form of House Resolution 410, and it is the Commission’s role to ensure adequate resources are available to meet demands for energy and to ensure the interests of customers are fully considered. The proceeding initiated today will provide the MPSC and interested stakeholders with additional information at this early stage.

The MPSC’s order lists questions to which it seeks information from the utility as soon as possible, including:

  • what alternatives the utility considered,
  • detailed information on customer impacts from the contemplated early termination of the PPA, including plans to replace the energy and capacity now provided by Palisades,
  • whether there is sufficient replacement capacity and energy within the Midcontinent Independent System Operator (MISO) to ensure reliability,
  • whether the utility has plans for a Certificate of Need filing,
  • detailed information on all available cost recovery and financing options and how each compares in terms of ratepayer benefits,
  • information on the adequacy of funding in the decommissioning trust fund and plans for continuous, decades-long monitoring of the site to ensure public safety and environmental protection, and
  • an analysis of the effect on emissions and fuel diversity of closing Palisades.

In addition, the MPSC is directing the utility to file a revised five-year forecast in its pending 2017 power supply cost recovery (PSCR) plan case (Case No. U-18142) within 30 days.

Case No. U-18218 et al.

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