Dive Brief:

• Ameren Missouri’s 1,195-MW Rush Island power plant is necessary to maintain grid reliability, the Federal Energy Regulatory Commission said Monday in a decision approving a “system support resource,” or SSR, agreement for the generating station.

• Separately, FERC rejected Ameren Missouri’s request for an additional 0.5% return on equity in its cost recovery for keeping the plant running longer than originally planned.

• Ameren Missouri’s proposed cost recovery plan may not be just and reasonable, according to FERC, which ordered hearings to hash out disputed issues around the payment plan. The agency urged Ameren Missouri and the parties protesting the plan – Wabash Valley Power Association, Illinois Municipal Electric Agency and Illinois Industrial Energy Consumers – to settle their dispute.

Dive Insight:

Instead of retiring its Rush Island power plant on Sept. 1, 2022, as originally planned, Ameren Missouri expects to keep it running until mid-2025 to support grid reliability.

Shuttering the plant near Festus, Missouri, could cause severe voltage stability problems, leading to cascading power outages, the Midcontinent Independent System Operator said in an August application for a 12-month SSR agreement that can be renewed annually. The contract will be paid for by load-serving entities that benefit from keeping the plant running.

In its decision accepting the SSR contract, FERC said MISO adequately looked for ways to maintain grid reliability instead of keeping Rush Island running. MISO plans to continue looking at options for maintaining reliability besides keeping the plant operating, FERC said.

The SSR agreement can be terminated if the power plant is no longer needed to keep the grid running smoothly, according to FERC.

Separately, FERC said proposed monthly payments Ameren Missouri would receive for running the plant need further review in a hearing process.

“Our preliminary analysis indicates that Ameren Missouri’s filing has not been shown to be just and reasonable,” FERC said.

Also, FERC rejected Ameren Missouri’s request to include in its cost recovery an extra 0.5% ROE it receives as a MISO member.

The ROE “adder” applies to transmission facilities, not power plants, according to FERC.

“The designation of the Rush Island Units as SSR units does not convert them into a part of Ameren Missouri’s transmission system to which the [regional transmission organization] participation adder applies,” FERC said.

The adder is designed to encourage utilities to join RTOs. FERC is considering limiting the adder to three years instead of letting it run indefinitely for an individual utility.