Capacity Demonstration

Provisions in 2016 PA 341 Sec. 6w require all electric providers to demonstrate to the MPSC that they have enough resources to serve the anticipated needs of their customers.

STAFF LEAD

Roger Doherty

CAPACITY DEMONSTRATION 2024

All electric load-serving entities (LSE) in Michigan, including investor-owned electric utilities (IOU), electric cooperatives, municipal-owned electric utilities, and alternative electric suppliers (AES) are required to annually demonstrate to the Commission that it has sufficient planning resources four years forward to meet the needs of its customers.

The July 26, 2023 MPSC Order opened MPSC Docket No. U-21393 to receive capacity demonstrations from electric providers for the 2024 through 2027 planning years. The following filing dates are specified in the order:

IOUs with one million customers or more by February 15, 2024, pursuant to MCL 460.6w(8)(a).
IOUs with fewer than one million customers by March 1, 2024, pursuant to 460.6w(8)(a)

AESs, Electric Cooperatives, and Municipal-Owned Electric Providers by March 15, 2024, pursuant to MCL 460.6w(8)(b).

A report on said demonstrations from the MPSC Staff by May 10, 2024.

CAPACITY DEMONSTRATION DOCUMENTS

Current Process/Requirements

U-21393 Reporting Template (Long Form)

U-21393 Reporting Template (Short Form)

General Affidavit

AES Load Switching Affidavit

ONGOING TOPICS

In the July 26, 2023 MPSC Order in MPSC Docket No. U-21393, the Commission adopts the revised Capacity Demonstration Process and Requirements to integrate the changes in MISO's resource adequacy framework from annual to seasonal.

In the December 21, 2022 Order in MPSC Docket U-21225, the Commission provides further guidance on the comment topics listed in the June 23, 2022 order and lifts the ban on participation in the wholesale markets of regional transmissions operators by Michigan bundled retail commercial and industrial customers and aggregators of Michigan retail commercial and industrial customers for demand response resources over 1MW.

In the June 23, 2022 Order in MPSC Docket U-21099, the Commission requested comments on many ongoing resource adequacy topics. Entities filed comments on or before September 1, 2022. These discussions may result in changes to the currently approved capacity demonstration processes and requirements.

In the June 23, 2022 Order in MPSC Case U-21099, the Commission opened MPSC Docket U-21250 as a contested proceeding for Spartan Renewable Energy, Inc., to show cause why it should not be found in violation of MCL 460.6w for the 2025/26 capacity demonstration in MPSC Docket U-21099.

The Michigan Supreme Court Order on April 2, 2020 reversed the decision of the Court of Appeals on the MPSC's authority to impose a local clearing requirement (LCR). Please see the issue brief for more information. The MPSC has received comments on implementation of a Michigan LCR per it’s request in the Case U-21099 Order listed above. The earliest application of a locational requirement would be in the 2023 capacity demonstration process for planning years 2027/2028.

The Statewide Reliability Mechanism (SRM) capacity charges for each utility’s service territory should be reviewed at least once per year in a contested case before the MPSC, concluding by December 1 each year. Typically, an IOU will conduct this process in it’s Power Supply Cost Recovery (PSCR) process.

In its August 31, 2022 Order, the Federal Energy Regulatory Commission (FERC) accepted the proposed tariff from the Midcontinent Independent System Operator (MISO) to implement a seasonal resource adequacy construct. As noted in MPSC Staff comments in MPSC Docket U-21099, this may result in changes to the currently approved capacity demonstration processes and requirements. The earliest application of a seasonal requirement in the Michigan capacity demonstration process would be in the 2023 capacity demonstration process for planning years 2027/2028.