Plan to extend operations at Cook Plant approved - Fox 28: South Bend, Elkhart IN News, Weather, Sports

Plan to extend operations at Cook Plant approved

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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."


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