The following is from a press release from Indiana Michigan Power.
Michigan Regulators Approve Comprehensive Plan to Extend Operations at Cook Plant.
FORT WAYNE, Ind., January 31, 2013 – The
Michigan Public Service Commission (MPSC) has approved Indiana Michigan
Power's (I&M) Life Cycle
Management Project (LCM Project) that will allow I&M to continue to
operate the Donald C. Cook Nuclear Plant (Cook Plant) in Bridgman,
Michigan during its 20-year operating license extension. I&M had
proposed an asset management program of over $1 billion
that would be performed over multiple years on various systems and
equipment.
The MPSC recognized the need for the
LCM Project as an integrated program with a purpose of ensuring the
safe and reliable operation of the Cook Plant. The MPSC approved the
complete scope of activities to be performed,
including the sizing of certain additions to allow for a potential
capacity expansion if needed in the future. The MPSC granted I&M's
request for a certificate of necessity at the Cook Plant and approved a
cost estimate of $851 million. This is less than
the full cost of the LCM Project because some LCM Project activities are
already approved and in service or are being performed outside of the
six-year timeframe required for pre-approval under Michigan law. Those
portions of the project performed already
will be eligible for other timely recovery by the company. The approved
cost estimate includes a cost contingency of 10%, as allowed under
Michigan law, in the event project costs exceed the approved level of
costs.
"We are pleased that the Michigan
Commission appreciates the value the Cook Plant brings to our customers
and recognizes that the comprehensive LCM Project is a worthy investment
in the Cook Plant's continued operations"
said Paul Chodak III, President and Chief Operating Officer for I&M.
"We are particularly pleased that the Commission understands that the
cost of contingencies for a project of this scope and duration are real
and need to be recognized in the cost estimate."
The Cook Plant provides low-cost,
emission-free electricity to I&M's customers and is an important
component of I&M's diverse generation resources needed to address
increasingly stringent federal air emission regulations.
The two units at the Cook Plant generate over 2,100 megawatts – enough
energy to power approximately 1.5 million homes – and account for 40
percent of the company's power generation portfolio. I&M received
license extensions from the Nuclear Regulatory Commission
in 2005 that will allow the units to run until 2034 and 2037
respectively – an additional 20 years beyond their original operating
licenses.
The LCM Project was reviewed and
approved outside of a traditional general rate case proceeding. To
assure that the LCM Project is managed effectively, I&M will review
the status of the LCM Project with the MPSC every six
months and will retain an independent expert to monitor I&M's
project management and cost controls and report its findings to the
MPSC.
"I&M is always mindful of the impact
that rate increases have on our customers particularly as our economy
continues to struggle" said Chodak. "The Life Cycle Management Project
is the most economical and reasonable means of meeting
our customers' energy needs now and in the future. Our strategy for
carrying out the LCM Project will mitigate the rate impact on customers
and allow the LCM Project to be completed at the lowest cost reasonably
possible."
