Midwest ISO May Face "Operational Challenge" from EPA MATS Rule, Study Says

The Midwest ISO, "may face an operational challenge in managing outage scheduling," as coal units are compelled to comply with the federal EPA's Mercury and Air Toxics Standards (MATS) rule, The Brattle Group found in a study released today.

Matters highlights the study due to Entergy Texas' application to join MISO.

The Southwest Power Pool has already proposed, in a list of issues, that the Public Utility Commission of Texas consider in its review of Entergy Texas' application whether there are, "greater uncertainties related to joining MISO, such as the impact of EPA regulations on MISO as compared to SPP."

Brattle said that, "[i]n evaluating the feasibility of the entire coal feet to meet MATS by the compliance deadline, we found that it is very likely that the industry will run into delays and bottlenecks, while MISO may face an operational challenge in managing outage scheduling."

"[I]t appears that MISO may have to schedule approximately 45% more MW of coal outages per season for MATS compliance by Fall 2015 (which assumes many plants will gain a 1-year compliance extension). The impact of these additional outages is further exacerbated by the fact that a substantial fraction of coal plants are likely to retire rather than comply with MATS, hence reducing the system's ability to absorb additional outages. Based on MISO's initial analysis of the fleet's ability to absorb outages, it appears that the total quantity of outages for MATS could be easily absorbed and scheduled in its low retirement scenarios. However, in MISO's 12 GW retirement scenario, it appears that MISO may only be able to absorb these outages by extending its typical 6-month (fall and spring) outage season to a 9-month (fall, winter, and spring) season. In MISO's even higher 19 GW retirement scenario, it appears likely that the RTO would not be able to schedule all of the needed outages even in a 9-month window without facing reliability concerns or gaining an additional 1-year reliability extension to 2017," Brattle said.