Coal generation in MISO capacity auction declines

Market: Coal, Electricity
24/05/23

Less coal generating capacity cleared the Midcontinent Independent System Operator's (MISO) seasonal planning resource auction this year than in previous years, partly because of power plant retirements.

Coal represented 27.7pc of 132,891MW of capacity that cleared the auction for the summer 2023 planning season, which starts on 1 June, according to slides%20Results628925.pdf) presented on 19 May and discussed at a MISO Resource Adequacy Subcommittee meeting today. That comes out to 36,750MW of coal capacity available for dispatch to the grid. For autumn of this year, winter 2023-24 and spring 2024, the amount of coal that cleared the auction ranged from 33,979MW to 31,367MW and represented 27-25pc of all of the cleared capacity.

Last year, 40,228MW of coal cleared MISO's 2022-23 planning auction, representing 30pc of all of the capacity that cleared.

The grid operator tied the reduced capacity primarily to coal plant retirements. The amount of coal-fired capacity in MISO's North-Central region has shrunk by 924MW, the grid operator estimated, and 1.2GW was retired. Across MISO, generators offered 45,400MW of confirmed installed coal capacity for this coming summer, compared with 47,700MW last year.

New natural gas and renewable generation will offset most of the decline in coal availability.

MISO expects to have adequate resources available to meet summer electricity demand. That is a better outlook than the grid operator portrayed last year, when both the grid operator's planning resource auction and a survey by the grid operator showed potential capacity shortfalls in at least some regions. All of MISO's regions had more capacity offers than necessary in the most recent auction. Offers for MISO's North-Central region, where most of the grids coal units are located, were 4.7pc above requirements.

MISO attributed the improved projection to delays in some power plant retirements and more available imported generation. About 2,700MW of capacity that had previously been expected to be closed was offered into the summer planning resource auction, the grid operator said.

Still, there likely will be little firm excess capacity available for periods of higher-than-normal electricity demand or greater than average power plant unit outages, MISO warned on 23 May.

Grid operator staff are expecting 115,000MW of capacity in June and matching amount of peak demand that month, July's probable capacity and peak demand will each be 123,000MW and August's will be 121,000MW and 120,000MW, respectively.

MISO also has 11,400MW of reserve capacity available, but if electricity demand is elevated, nearly all of the reserves will be used up, according to staff projections. Staff members forecast peak load during periods of increased electricity demand could be as high as 122,000MW in June, 130,000MW in July and 128,000MW in August.

If generators are forced to take a greater-than-normal amount of units out of service, MISO will have to dip into reserve margins even during periods when electricity demand meets expectations, the grid operator projected.

By Courtney Schlisserman

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