Power agency looks at land for natural gas generator

Michigan South Central Power Agency members discussed in closed session Thursday a possible option to buy land from Clemens Food Group near its Fiske Road plant as a site to build a 50-megawatt natural gas fired generator.

No public action was announced. The project discussed first in 2018 still remains on hold until the Midcontinent Independent System Operator of the power grid completes its study of transmission needs in Michigan.

The report on proposed projects for new generation will show costs and necessity for new transmission to serve the plants.

Coldwater, Hillsdale and Clinton are looking at the generator to meet some of their in-state generation requirements for power capacity in Michigan.

Michigan South Central Power Agency manager Pam Sullivan, from American Municipal Power, warned “there will be no decision until we get the MISO study. Then we will have three weeks to make a decision on whether we are going to stay in it or not.”

That may require special meetings of the city councils.

Coldwater would receive 74%, or 33.3 megawatts. Hillsdale would take 19%, or 8.6 MW. Clinton would purchase 7%, or 3.1 MW as now proposed.

Sullivan has talked to Michigan Municipal Power Association, another joint action agency, about taking 15 MW of the project.

Coldwater BPU Director Jeff Budd said, “that changes the whole dynamics.” He has been concerned about the financial risks of Coldwater’s large share, which could cost around $35 million.

MSCPA closed its 50MW coal plant at Litchfield in 2016. The cost of producing coal power was too high for the market.

Earlier his year, members of MSCPA paid a penalty for not having in state generation. The new gas generation would meet peak power and capacity needs in the state and put three members back into local generation ownership.

MSCPA has paid a more than $200,000 deposit against the cost of the study. Cost for the next step requires the member put up $630,275 to continue.

She said if MPPA participates it would need to share in the new costs. MSCPA would need to decide about sharing already expended costs.

The decision on projects in the 2019 queue has been on hold for two years as MISO worked on its decision. It is also coordinating with PJM. That is the regional transmission organization that coordinates the movement of wholesale electricity in all or parts of 13 states and the District of. Columbia and connects to MISO.

MISO is an independent, not-for-profit, member-based organization responsible for operating the power grid across 15 U.S. states and the Canadian province of Manitoba.

The Coldwater peaking project would use a refurbished 50MW gas peaking generators. It is pre-owned and would come from ProEnergy Services, which has offered the proposal. That unit is still available.

Scott Kiesewetter of AMP serves as its senior vice president of generation and transmission operations and oversees all functions of the Power Generation Group. He said an Illinois municipal system has another generator for sale but there is also interest in it.

Sullivan said MSCPA is in a unique situation and no one else is further along in the MISO queue.

Kiesewetter said engineers already have obtained an air quality permit for Coldwater from Michigan Department of Environment, Great Lake, and Energy for the project.

This article originally appeared on The Daily Reporter: Power agency looking at land or new 50 MW natural gas generator