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New Michigan Bill Would Impose Nonbypassable Charge on New Choice Customers; Require 12-Year Showing Of Resource Adequacy By Retail Suppliers (Sponsor Justifies Based On Price Spike in MISO Capacity Auction)
A new draft of Michigan SB437 was unveiled yesterday addressing retail choice, sponsored by Mike Nofs, Chair of the Energy and Technology Committee
Among other things, the latest draft would require retail suppliers to meet, about two years in advance, 50% of local capacity requirements that are to be imposed on LSEs, proportional to their load. Utilities would be required to meet 100% of the local requirement.
If the showing of capacity falls below 105% of the forecast local clearing requirement, retail suppliers would be required to meet 100% of local capacity requirements about 2 years in advance, with the obligation continuing for 12 years
SB437 would also now impose a nonbypassable capacity charge, for a 10-year period, on customers newly leaving the utility for choice. In such case, the utility would continue to be responsible for the customer's capacity
SB437 would retain the 10% choice cap, but would allow the choice queue to remain open
SB437 would allow existing customers who are currently 100% on choice to take choice for expansions of their facilities or for adjacent facilities (provided they own at least 50%), regardless of the 10% cap. Currently, only certain pre-2008 grandfathered customers may expand their choice load regardless of the cap
Nofs cited the recent spike for the Michigan zone in the MISO capacity auction (with the price spiking from about $3/MW-day to $72.00/MW-day) as requiring the resource adequacy provisions
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April 27, 2016
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Copyright 2010-16 EnergyChoiceMatters.com
Reporting by Paul Ring • ring@energychoicematters.com
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