The Louisiana Public Service Commission on Wednesday may take a step toward withdrawing from the interstate power grid that has, for the last decade, allowed power companies besides Entergy and Cleco to provide electricity to Louisiana.
District 1 Commissioner Eric Skrmetta, who represents the southeastern areas of the state outside of New Orleans, placed the motion on the agenda of the commission’s upcoming Nov. 17 meeting. It proposes to “provide written notice of withdrawal from membership to MISO.”
MISO stands for Midcontinent Independent System Operator and is a nonprofit association that manages the power grid across 15 states and the Canadian province of Manitoba, providing electricity to 42 million people.
Skrmetta first proposed the idea to withdraw at the commission’s last meeting on Oct. 20 after hearing a report from two consultants who expressed concern about wind turbine projects that MISO is considering approving in some northern states.
Membership in the MISO grid provides benefits such as allowing Louisiana to borrow electricity from other states during times of emergencies. Part of the reason why the February winter storm power blackout in Texas lasted several days was because much of Texas is not connected to an interstate grid such as MISO, says Simon Mahan, executive director of the Southern Renewable Energy Association.
Membership also allows power companies to buy and sell electricity from other states at wholesale prices, which creates competition in areas such as Louisiana that are serviced by only one or two power companies, Mahan says.
“Now what we see is a tremendous amount of wind assets that are built up in MISO north, and were built on production tax credits through the Internal Revenue Code, and they were effectively pretty close to free to build these wind turbines, which are great, but they didn’t provide the transmission,” Skrmetta said at that time. “They’ve gotten free windmill assets. Now they want the ratepayers to pay for the transmission for these stranded wind assets that are going to cost $130 billion to bring into the marketplace.”
MISO divides projects between its southern and northern members, so that members don’t have to pay for distant projects that they receive little benefit from, Mahan says. However, the consultants told the commissioners that MISO could change this in the future and start charging its southern members for projects in the north.
Consultant Lane Sisung told the commissioners that MISO assured him that the costs of the northern wind projects would be allocated only to the northern states, but Sisung expressed concern about a “five-year look-back period” that MISO could later use to justify charging its southern members.
In an email to the Louisiana Illuminator on Thursday, MISO spokesperson Brandon Morris said the southern states would not be paying for the projects: “MISO is currently proposing a cost allocation methodology which would not allocate costs from northern MISO into southern MISO.”
But consultant Noel Darce told the commissioners that some future projects would involve long-range transmission of wind energy from northern states to southern states and expressed concern that MISO’s estimate of cost-savings is “overstated.”
Louisiana has been on the MISO grid since Entergy joined in 2013, a move that halted a federal antitrust investigation into the utility company.