In light of a declining power reserve margin because of existing Environmental Protection Agency (EPA) rules, the Midcontinent Independent System Operator (MISO) has significant reliability concerns about EPA's proposal to cut carbon dioxide emissions by 30%.
MISO filed its comments with EPA Nov. 25, just days ahead of the Dec. 1 deadline for comments. In June EPA rolled out its plan to have states cut CO2 emissions from the power sector 30% by 2030.
“MISO has identified electric system reliability concerns related to the proposed rule's 2020-2029 interim performance requirements,” MISO President and CEO John R. Bear said in a statement.
“The MISO region faces declining power reserve margins due to EPA's Mercury and Air Toxics Standards [MATS] and other factors,” Bear said. “The Clean Power Plan will drive further changes to the energy resources used across our footprint. Building new generation, natural gas infrastructure and transmission facilities necessary to support electric system reliability will take more time than the interim performance period allows,” Bear said.
MISO research indicates that between 10 GW and 12 GW of coal-fired generation will retire by 2016 anyway to meet MATS requirements. The interim requirements in the EPA CO2 proposal indicates that up to 25% of the remaining coal capacity in MISO - which equates to 14 GW - could potentially retire in order to comply with the proposed rule.
The current natural gas delivery and storage system in much of the MISO region was not developed to support use of natural gas electric plants as baseload generation, MISO said.
“The final rule should give states flexibility to design compliance strategies that preserve reliability and ensure efficient outcomes,” said MISO's Bear. MISO said that its official comments reflect months of work by MISO, member companies and regulators.
In five pages of comments, MISO said that its initial analysis of the proposed rule suggest that nearly 80% of the total emission reductions must be met by 2020.
The earliest a state plan could be approved is 2017. Approval of a single state plan will be challenging, and coordinated approval of many state plans by this time presents further difficulties.
“In the likely event that states request additional time, it is possible that many states will not have approved plans until 2019,” according to MISO comments. “Since action will be needed by 2020 to achieve the interim emissions performance levels, there will not be nearly enough time to plan for the replacement capacity, transmission upgrades, and natural gas delivery infrastructure that will be needed to maintain reliability and resource adequacy.”
MISO is designed to maintain reliable operation of more than 65 thousand miles of electric transmission lines in 15 states and the Canadian province of Manitoba through coordinated regional economic dispatch of power plants and forward-looking planning.
“MISO proposes that EPA eliminate the interim [2020 through 2029] performance requirements when the final rule is issued. Instead, EPA should allow states to submit plans for EPA's approval that specify interim compliance objectives to best fit their circumstances,” MISO said.