Dive Brief:

• The Midcontinent Independent System Operator said its grid will have sufficient power supplies through 2016, despite a previous survey which projected a 2.3 GW shortfall beginning next year.
• MSIO officials said load-serving entities and state regulators within its territory are moving to address declining reserve margins, with the most recent survey results showing a 1.7 GW surplus for 2016.
• The shift is largely due to increased resources and a decline in load forecast, the operator said, but cautioned that the survey also found a portion of the grid will need to import power from neighboring zones next year to meet obligations.

Dive Insight:

What a difference a year makes.

A 2014 survey of MISO load-serving entities and state regulators had predicted a 2.3-GW shortfall beginning next year, but capacity additions and shifting load forecasts – combined with the ability to move power between zones – means resources should remain adequate through 2020.

The results of this latest survey of resource adequacy alleviate some of the short-term concerns presented by coal plant retirements brought on by cheap natural gas prices and EPA air quality regulations. They also show how quickly organized markets can shift to fill resource needs, supporters say.

“The results are encouraging. It shows that action is being taken to address an issue of concern for the MISO region,” Clair Moeller, MISO executive vice president of transmission and technology, said in a statement. “However, it is important to note that more work remains to be done. While the near-term picture has improved, the longer-term forecast requires continued vigilance to ensure there are adequate resources.”

Lowered reserve margins present “a new operating reality for MISO members,” the grid operator said, cautioning that it would lead to relying on emergency operation procedures, such as behind the meter generation and demand response. 

A part of the MISO region will fall below reserve requirements next year, the operator said, but that zone will be able to import sufficient power from other parts of the grid.

OMS President and Iowa Utilities Board Member Libby Jacobs said the improvement in the numbers “shows an appropriate response to the needs of the region and we would expect that same level of focus to continue in future years.”

Arugs reports the projected shortfall in MISO Zone 7, which includes Michigan's lower peninsula, now sits at about 1.2 GW – a significant improvement over last year's 3 GW shortfall prediction. The shortfall does not represent a lack of physical capacity, Arugs noted, but the ability for generators in that area to instead send power into the PJM market.