The following is attached for paperless electronic filing: Initial Brief on behalf of the Environmental Law & Policy Center

Transcription

1 July 14, 2017 Ms. Kavita Kale Michigan Public Service Commission 7109 W. Saginaw Hwy. P. O. Box Lansing, MI RE: MPSC Case No. U Dear Ms. Kale: Sincerely, The following is attached for paperless electronic filing: Initial Brief on behalf of the Environmental Law & Policy Center Proof of Service Margrethe Kearney Environmental Law & Policy Center cc: Service List, Case No. U-18224

2 STATE OF MICHIGAN MICHIGAN PUBLIC SERVICE COMMISSION In the Matter of the Application of UPPER MICHIGAN ENERGY RESOURCES CORPORATION for approval of a Certificate of Necessity pursuant to MCL 460.6s for Two Reciprocating Internal Combustion Engine Electric Generation Facilities Located in the Upper Peninsula of Michigan, Approval of Certificate(s of Public Convenience And Necessity, approval of a Special Contract with Tilden Mining Company L.C. and related accounting and ratemaking authorizations. Case No. U INITIAL BRIEF ON BEHALF OF ENVIRONMENTAL LAW AND POLICY CENTER July 14, 2017

3 Contents I. INTRODUCTION... 1 II. FACTUAL AND PROCEDURAL BACKGROUND... 2 A. Events Leading Up to UMERC s CON Application... 2 B. Integrated Resource Plan Best Practices... 3 C. HDR Engineering s 2017 Report Underpinning UMERC s Integrated Resource Plan... Error! Bookmark not defined. III. LEGAL STANDARD... 5 IV. ARGUMENT... 7 A. UMERC s CON Application must be denied because the Company s IRP is contrary to Michigan law and woefully inadequate B. UMERC cannot be allowed to contract around Michigan law and this Commission s regulations V. CONCLUSION... 14

4 I. INTRODUCTION. The Commission should deny Upper Michigan Energy Resources Corporation s ( UMERC or the Company applications for (1 a Certificate of Necessity that its proposed UP Gen Project represents the most reasonable and prudent means of meeting its power need, and (2 a Certificate of Necessity that the costs of the UP Gen Project will be recoverable in rates from UMERC s customers. UMERC has not met its burden of demonstrating that the UP Gen Project is the most reasonable and prudent means of meeting demand relative to other resource options. Rather than presenting the most reasonable and prudent means of meeting demand, the proposed UP Gen Project represents a negotiated solution between UMERC s Wisconsin-based predecessors and its largest customer, the Tilden Mining Company ( Tilden Mine or Tilden. UMERC s Integrated Resource Plan ( IRP failed to comply with Michigan law and was wholly inadequate in its consideration of renewable resources and storage to displace a portion of the proposed gas generation. To be clear, ELPC strongly supports the retirement of the coal-fired Presque Isle Power Plant ( PIPP and recognizes the challenges faced in finding a long term solution to energy issues in the UP. However, new generation in the Upper Peninsula should be the result of a datadriven, credible analysis of alternatives that actually results in the most reasonable and prudent generation choice for all customers. UMERC s proposal is not the result of such an analysis; it is the result of closed-door negotiations between UMERC and the Tilden Mine. As renewable energy and storage technology become increasingly viable options for meeting Michigan s energy needs, it is paramount that the Commission insist on a robust evaluation of these technologies in IRP and CON filings. UMERC s ratepayers and the people of Michigan s Upper Peninsula deserve such an analysis. Without such an analysis, the entire purpose of the 1

5 Certificate of Necessity process is futile. Therefore, ELPC asks the Commission to deny UMERC s CON applications until such time as UMERC conducts the analysis necessary to carry its burden of proving that the UP Gen Project is the most reasonable and prudent means of meeting demand. II. FACTUAL AND PROCEDURAL BACKGROUND. A. Events Leading Up to UMERC s CON Application. On April 23, 2015, in case number U-17682, the Commission approved a settlement agreement between various parties, including Wisconsin Energy Corporation ( WEC and Wisconsin Electric Power Company ( WEPCo, referred to as the Amended and Restated Settlement Agreement ( ARSA. See generally Ex. A-3. The ARSA required, among other things, that WEC and WEPCo establish a new Michigan-only jurisdictional utility to facilitate a long term solution for a new, clean generation plant located in the Upper Peninsula of Michigan. Ex. A-3 at 10, 21. The long-term solution in the ARSA would result in the potential retirement of the coal-fired Presque Isle Power Plant ( PIPP a retirement that ELPC wholeheartedly supports. Ex. A-3 at However, the ARSA neither specified the type of generation nor exempted the proposed new Michigan-only jurisdictional utility from meeting the requirements of Michigan law should it seek recovery of the project costs from its customers. See generally Ex. A-3; see also 3 TR 192:9-15. On August 12, 2016, WEC signed a contract with the Tilden Mining Company that set out the rights and obligations of each party with regard to supplying electricity to Tilden s mining operations in Michigan s Upper Peninsula. This contract is referred to as the Tilden Special Contract. See Ex. A-25. On January 1, 2017, WEC assigned all rights and obligations under the Tilden Special Contract to UMERC. 3 TR 147. UMERC is the Michigan-only jurisdictional utility established by WEC and WEPCo pursuant to the ARSA. 2

6 The Tilden Special Contract specifically required that Reciprocating Internal Combustion Engines ( RICE technology and no other technology could be used to supply electricity under the contract. See Ex. A-25 at 16 ( Prior to signing the contract, no analysis was done by WEC to determine whether RICE technology was the most reasonable and prudent means of supplying electricity in what would become the UMERC service territory in Michigan s Upper Peninsula. 3 TR 310. Though the contract predetermined the generation technology, it temporarily left open the issue of how much RICE capacity would built. The contract provided that such issue would be decided later. See Ex. A-25 at 16 ( On January 30, 2017, UMERC and Tilden resolved the last outstanding issue and mutually agreed that 183 MW would be the Planning Load required under section of the Tilden Special Contract. 3 TR 140. On the same day, UMERC filed an application for a Certificate of Necessity to build 183 MW of new capacity in the form of two RICE facilities consisting of a total of ten RICE units in the Townships of Negaunee and Baraga, referred to in this case as the UP Gen Project. Application at 2; 3 TR Knitter 221. B. Integrated Resource Plan Best Practices. As required by Michigan law, UMERC s application contained an IRP. See Ex. A-19; see also MICH. COMP. LAWS ( MCL 460.6s(11. An IRP is a plan for meeting forecasted annual peak and energy demand needs. 4 TR 626. An IRP uses a combination of supply-side and demand-side resources to map solutions for a utility s total capacity needs. Id. An IRP forecasts future loads, identifies potential resource options to meet those future loads, specifies supply and demand-side resources available to meet needs as required, determines the optimal mix of resources based on the goal of minimizing costs, and outlines the utility s plan for implementing its IRP. Id. There are well-established best practices for IRPs. 4 TR 627. Some of these best practices 3

7 are included in a presentation the Lawrence Berkeley National Laboratory gave to the Michigan IRP policy development stakeholder s meeting on May 1, ( LBNL Presentation See generally Ex. ELP-2. For instance, it is best practice to actively and openly engage stakeholders in development of the IRP and to compare energy efficiency and demand response with supplyside alternatives. Ex. ELP-2 at 39, 42. Other best practices can be gleaned from a presentation published by the Department of Energy s Office of Energy Policy and Systems Analysis titled Power Sector Modeling 101. ( DOE Presentation See generally Ex. ELP-3. Both the LBNL Presentation and DOE Presentation include significant attention to the importance of capacity expansion models for IRP purposes and both presentations provide an overview of how capacity expansion models should be used. See Ex. ELP-2 at 38, 75; Ex. ELP-3 at Capacity expansion models are [o]ften used for Integrated Resource Plans. Ex. ELP-3 at 12. Capacity expansion models underpin an IRP because capacity expansion models simulate generation and transmission capacity investment, given assumptions about future electricity demand, fuel prices, technology cost and performance, and policy and regulation. Ex. ELP-3 at 2. Another model used by utilities is called a production cost model. Production cost models [s]imulate operation of a specified power system over a relatively short period compared to capacity expansion model (1-week to 1-year, but at higher temporal resolution (hours to 5- minutes. Ex. ELP-3 at 19. As the DOE Presentation noted, production cost models are not suited for simulating new generation or transmission capacity. See Ex. ELP-3 at 21. When it comes to examining the impacts of power sector policies (or alternative technology/fuel trajectories on the generation and capacity mix in the mid- to long-term, capacity expansion models do this particularly well. Ex. ELP-3 at 13. 4

8 Capacity expansion and production cost models are created using software. The capacity expansion modeling software available to UMERC is known as Electric Generation Expansion Analysis System ( EGEAS. 3 TR Rather than use EGEAS or another capacity expansion tool to create a capacity expansion model as part of its IRP, UMERC instead used production cost modeling software called PROMOD. Id. III. LEGAL STANDARD. Prior to construction of the proposed new generation, a utility may apply for a CON from the Commission. See MCL 460.6s(1, (3. Here, UMERC has applied for three CONs, asking the Commission to find that (1 the power to be supplied by the RICE units is needed, (2 the UP Gen Project is the most reasonable and prudent means of meeting that need, and (3 the cost of the UP Gen Project will be recoverable in rates from UMERC s customers. Application at 2. In order for the Commission to approve the CON application, the utility bears the burden of proving that its proposed capacity addition represents the most reasonable and prudent means of meeting the power need relative to other resource options for meeting power demand, including energy efficiency programs, electric transmission efficiencies, and any alternative proposals submitted under this section by existing suppliers of electric generation capacity under subsection (13 or other intervenors. MCL 460.6s(4(d (emphasis added; see also 460.6s(3(b. In order to prove its proposed capacity addition represents the most reasonable and prudent means of meeting the power need, the CON application must be supported by an IRP. See 460.6s(11. Among other things, the IRP must include: (c Projected energy and capacity purchased or produced by the electric utility under any renewable portfolio standard. (d Projected energy efficiency program savings under any energy efficiency 5

9 program requirements and the projected costs for that program. (e Projected load management and demand response savings for the electric utility and the projected costs for those programs. (f An analysis of the availability and costs of other electric resources that could defer, displace, or partially displace the proposed generation facility or purchased power agreement, including additional renewable energy, energy efficiency programs, load management, and demand response, beyond those amounts contained in subdivisions (c to (e s(11(c-(f (emphasis added. In addition to the statutory requirements, the Commission promulgated regulations implementing the IRP requirements of MCL 460.6s(11. See generally MICHIGAN PUBLIC SERVICE COMMISSION, ORDER, Case No. U-15896, Ex. B (Dec. 23, 2008 ( Integrated Resource Planning Guidelines. The IRP must include the following information for all potential generation resources considered in the integrated resource plan: 1. A description of the technologies considered for the new generation source, including the primary fuel and fuel alternatives, capacity, expected availability, and lead time for construction for each technology. 2. The estimated costs of developing potential generating resources including cost components attributable to plant capital costs, engineering, procurement, construction, financing, specific or generalized transmission upgrades, and owner s costs. 3. The estimated costs of operating potential generating resources including fuel, operations and maintenance, and environmental compliance. 4. A discussion of the commercial availability or developmental status of various generation technologies. 5. If applicable, a description of the renewable aspects of any supply side technology and how it will receive credit under any State or Federal Renewable Portfolio Standard requirement. Integrated Resource Planning Guidelines at 3 of 13. The IRP must also consider Demand Reduction resources such as load 6

10 management, demand response, energy efficiency, net metering service, and distributed generation as a means of affecting forecasted load requirements. Id. at 4 of 13. Costs for load management programs, demand response programs, energy efficiency programs, and distributed generation must be included. Id. at 4-5 of 13. A discussion of the commercial viability, availability, or developmental status of distributed generation technologies is required. Id. at 5 of 13. Lastly, the IRP shall identify the projected need for future energy resources due to load growth, changes to existing or available resources, legislative mandates, Commission orders, or other reasons identified during the integrated resource planning process and shall present the course of action which is considered to best satisfy those needs through the application of reliable and cost-effective measures with due consideration of the associated benefits and risk. Id. at 7 of 13. IV. ARGUMENT. UMERC failed to meet its obligations under Michigan law and the Commission s regulations to fully evaluate renewable energy and storage alternatives that could partially displace the proposed RICE facilities. The Commission should not allow the Company to recover from its own customers the cost of building ten RICE units that were not chosen because they are the most reasonable and prudent alternative, but rather were chosen as a negotiated solution between UMERC and its largest customer, Tilden Mine. ELPC s expert witness Michael Granowski, who has over 25 years of experience in the energy industry, concludes in no uncertain terms that UMERC did not adhere to IRP best practices and performed an inadequate IRP analysis in support of the UP Gen Project. 4 TR 625. Approving UMERC s CON based on a flawed IRP not only allows UMERC to contract 7

11 around its legal obligations, it sets a dangerous precedent for the development of sound energy policy in Michigan s Upper Peninsula. The Commission should reject UMERC s application for a CON that the UP Gen Project represents the most reasonable and prudent means of meeting its power need and a CON that the costs of the UP Gen Project will be recoverable in rates from UMERC s customers. UMERC should be required to meet its obligations under the ARSA and implement a solution that results in the closure of PIPP without violating Michigan law and the Commission s regulations. A. UMERC s CON Application must be denied because the Company s IRP is contrary to Michigan law and woefully inadequate. UMERC s CON application should be rejected because its IRP failed to consider the availability and cost of other electric generation resources that could partially displace the ten proposed RICE units, including alternative renewable generation resources. MCL 460.6s(11(f. The IRP study was conducted using the assumption that UMERC needed a total of 183 MW of capacity and redundancy a number taken directly from the Tilden Special Contract. 3 TR UMERC s IRP only evaluated solutions that used individual technologies to fill 100% of the 183 MW identified need and did not consider combinations of technologies, including the ability of renewable options to displace some portion of the RICE units. 3 TR 328: UMERC s IRP contained not a single cost estimate for the renewable alternatives considered, such as solar, wind, or solar plus battery storage, and such cost estimates for all alternatives are required by the Commission s regulations established in Case No. U See supra III; Integrated Resource Planning Guidelines at 3 of 13; see also Ex. A-19 at 7-8. The Integrated Resource Planning Guidelines require an IRP to include, among other things, the following information for all potential generation resources considered in the integrated resource 8

12 plan... The estimated costs of developing potential generating resources... The estimated costs of operating potential generating resources. Integrated Resource Planning Guidelines at 3 of 13. None of these estimated costs were included for any potential renewable generation resources considered in UMERC s IRP. Even though Michigan law directs UMERC to consider the availability and costs of other electric resources that could defer, displace, or partially displace the proposed generation facility, and even though the statute explicitly identifies additional renewable energy as one of the resources that utilities must evaluate, see MCL 460.6s(11(f, Mr. Knitter testified that he did not consider whether renewable resources such as solar, solar plus storage, or wind could partially displace the RICE unit generation. 3 TR 308:19-309:7. UMERC s IRP fails to comply with MCL 460.6s(11. Rather than undertake a comprehensive, forward-looking approach, UMERC chose a strategy that intentionally set mainstream, intermittent renewable technologies up for failure by considering only whether they could meet the full amount of UMERC s identified need. Not only does this represent an egregious methodological flaw in their IRP, 4 TR 628:1-8, it is also in direct violation of Michigan law. As Staff witness Julie Baldwin explained in response to discovery: It is not common for a utility to only consider renewable energy to meet all or a significant portion of generation need. Ex. ELP-8. Indeed, it is contrary to Michigan law to expect renewables to meet the all or nothing standard that UMERC applied in its IRP. See MCL 460.6s(11(f. As ELPC s expert witness Michael Granowski explained, Renewables should have been treated as an incremental resource, not a single-solution resource. 4 TR 631:9-10. Mr. Granowski has been working in the energy field for over 25 years and has executed multiple IRP and Generation portfolio analysis efforts. 4 TR 624: He has developed proprietary tools to 9

13 evaluate the cost and risk of generation portfolios for IRP purposes and has developed and executed public stakeholder processes to support IRP development. 4 TR 624. Mr. Granowski advised We Energies, prior owner of UMERC, in developing a response to Wisconsin s proposed Renewable Portfolio Standard. 4 TR 625. Mr. Granowski s testimony explained that the modular nature of solar facilities make them ideal for addressing one of the limitations identified by Mr. Knitter in his testimony: Michigan s Upper Peninsula is a load pocket, and solar facilities locational flexibility provides the opportunity to place units closer to load starved areas and help support local resource deficiencies should they exist. 4 TR 631:9-15. UMERC again ran afoul of Michigan law by dismissing battery storage out of hand without even an attempt at analyzing the possible use or cost performance. 4 TR 632. Battery storage should have been considered because it may have allowed the UP Gen units to run at a higher capacity factor than 55% by storing the excess energy when it is not needed and dispatching that energy when load is higher. 4 TR 632: This could allow for fewer than ten RICE units operating at a higher and more efficient capacity factor. 4 TR 632: Furthermore, Mr. Granowski testified that [b]attery storage also offers a fast frequency response well outside the ability of any of the other supply options considered, including the UP-Gen RICE units. 4 TR 632: Mr. Knitter s failure to consider whether renewable resources, battery storage, or some combination of the two could partially displace the ten RICE units resulted in a flawed IRP that (1 cannot support UMERC s contention that the UP Gen Project is the most reasonable and prudent means of meeting its power need; (2 failed to comply with Michigan law. Michigan law explicitly requires that an IRP analyze partial displacement alternatives not just alternatives that fully displace the proposed project. MCL 460.6s(11(f. Mr. Granowski testified that it is 10

14 not only possible to consider partial displacement when dealing with multiple smaller modular units, such as those contemplated by the UP-Gen project, but that adequately considering partial displacement of such units actually tends to lead to more optimal results. 4 TR 626:3-7. Even while UMERC touts the scalability and modular nature of the RICE units, the Company failed to consider technologies such as solar PV or battery storage, which boasts the exact same scalability and modular nature, as partial displacement alternatives, and such partial displacement analysis was required by law. See 4 TR 629:9-14; MCL 460.6s(11(f. Exemplifying the unreasonableness and unlawfulness of his methodology, Mr. Knitter forced energy optimization to provide for the full load requirement of 183 MW, even though Michigan law requires an IRP and an electric utility to evaluate energy efficiency, load management, and demand response programs that could defer or partially displace the proposed generation facility. MCL 460.6s(11(f (emphasis added; 3 TR 232:8-14. As Mr. Granowski testified, this undertaking is a preposterous scenario because energy optimization is a smaller incremental method of reducing capacity need and is not meant to make up large chunks of capacity requirements. 4 TR 630:2-5. Furthermore, the fact that that the weighted average cost of energy optimization in Michigan is well below the cost of energy for the UP-Gen Project means that there is a strong indication that some level of energy optimization would be effective and potentially provide for a lower cost solution than the proposed UP Gen Project. 4 TR 630: UMERC s flawed IRP is due in part to its use of the production-cost modeling software PROMOD rather than a Capacity Expansion Modeling tool more appropriate for IRPs, such as EGEAS, which is available to the Company. 3 TR As Mr. Granowski explained: Mr. Knitter s scenario development approach is constrained at best and not in keeping with good IRP practice. Had Mr. Knitter utilized more standard industry 11

15 tools for IRP analysis, such as Strategist, Aurora, or PLEXOS, to name a few, the tool would have explicitly optimized capacity expansion to serve the load requirement through any possible combination of the asset solutions specified, including EO, solar PV, and battery storage. 4 TR 633: In addition, the DOE Presentation makes clear that capacity expansion models and not production cost models are ideal for utility resource planning purposes and are therefore often used for IRPs. See Ex. ELP-3 at UMERC used a program made for simulating operation of a specified power system over a relatively short period compared to Capacity Expansion Model and this resulted in a flawed analysis because it was simply the wrong tool for the job. See 4 TR 633. In addition, even though Mr. Knitter failed to use capacity expansion modeling software, he could have used the PROMOD tool to create scenarios that combined solutions rather than using only single-source solutions Mr. Knitter just chose not to. 4 TR 634:1-11. UMERC s insistence on evaluating single-source solutions using software that constrained its ability to consider whether renewable alternatives could partially displace a portion of the proposed 10 RICE units violates Michigan law and IRP best practices. UMERC s failure to follow IRP best practices results in a methodological failure that compromised the IRP s ability to comply with Michigan law. The Commission should not interpret MCL 460.6s(11 as wholly procedural i.e., that a Company can merely file a document, title it an IRP, and briefly address alternatives with no substantive discussion. UMERC s incomplete analysis cannot satisfy the statutory burden to prove that the UP Gen Project is the most reasonable and prudent means of meeting the UP s power needs. MCL 460.6s(4(d. As a result, UMERC s IRP is inadequate to support its application for a CON and the Commission should deny it. Id. UMERC s application for a CON that the costs of the UP 12

16 Gen Project are recoverable from its customers should therefore also be denied. B. UMERC cannot be allowed to contract around Michigan law and this Commission s regulations. UMERC cannot use the Tilden Special Contract as justification for its inadequate IRP. Costs paid for by UMERC s customers should be driven by the open, transparent process required under Michigan law and designed to result in the most reasonable and prudent means of meeting the identified power need. UMERC s witness Jeff Knitter admitted that the RICE units were not selected because they were the most reasonable and prudent means of meeting generation requirements. 3 TR 310:7-22. To the contrary, the choice of RICE units was solely the result of negotiations between UMERC and Tilden. Id. Indeed, Mr. Knitter did not do and was not asked to do an IRP study before the Tilden Special Contract specified the choice of generating resources. 3 TR 309. In fact, Mr. Knitter was not even involved in the negotiation of the contract, even though UMERC was aware of the technology choices that they would likely be proposing to Tilden. 3 TR As Mr. Knitter testified: Q: And the Tilden Special Contract selected RICE units for the U.P. Gen Project; is that correct? A: RICE units are specified in the contract. Q: They re specified in the contract. And prior to the signing of the Tilden Special Contract, UMERC never concluded that those specified RICE units were the most reasonable and prudent means of meeting the power need, did they? A: We had - - we are aware, UMERC was aware of the technology choices that we would likely be proposing to the Mines, those included RICE units and combined cycle generally. Q: But UMERC did not conclude that the RICE units were the most reasonable and prudent means of meeting the generation requirements, correct? 13

17 3 TR 310. A: It s a negotiated contract, it was part of the contract negotiations that that was specified. Q: So it was a negotiated resource choice; is that correct? A: Correct, as far as I know. I wasn t there. Mr. Knitter s reliance on the Tilden Special Contract to support UMERC s generation choice is apparent in his response to Mr. Granowski s testimony. Mr. Knitter complains that ELPC s approach would have UMERC and Tilden tear up the Tilden Special Contract and start over from scratch. 3 TR 254: It is troubling that Mr. Knitter seems to view the Tilden Special Contract as unassailable and a trump card to the requirements set out in Michigan law and this Commission s regulations. Even though Mr. Knitter testified that [his]job is to do leastcost planning he was non-committal when asked if he would recommend renegotiation of the Tilden Special Contract if the IRP had shown that the 10 RICE units were not the least cost means of meeting UMERC s power need. 3 TR 313: Mr. Knitter s response should have been an unequivocal recommendation to follow the law and not the contract. The purpose of the CON application and the requirement that it be supported by an adequate IRP is that these procedures are necessary to protect the interests of all customers and maintain the integrity and credibility of a highly regulated monopolistic market. Approving UMERC s CON application on the basis of an inadequate and predetermined IRP where the generation resource is contractually selected by the utility and its largest industrial customer prior to the IRP cannot be the foundation of Michigan s no regrets energy policy in the UP. V. CONCLUSION The Commission must reject UMERC s CON applications because UMERC violated Michigan law by considering only single-source solutions that conformed to a contractually 14

18 predetermined result. UMERC failed to meet its burden of demonstrating that the UP Gen Project is the most reasonable and prudent alternative. In contrast, the UP Gen Project is a negotiated solution between a Wisconsin-based utility and Tilden Mine, where rights were later assigned to UMERC, and the solution was agreed upon by those two parties without the input of UMERC s non-tilden customers or other stakeholders in the UP. A long-term solution in the UP cannot be reached behind closed doors or through studies artificially constrained to eliminate the possibility of resource combinations, in violation of Michigan law. Instead, a long-term solution must be based on transparent adherence to legislated procedures designed to ensure that utilities such as UMERC make the most reasonable and prudent generation choice for all of their customers. That includes legitimate consideration of renewable energy and storage technology to displace some portion of the proposed generation, especially as these technologies are beginning to play a greater role in Michigan s energy mix. The Commission should reject UMERC s application for a CON that the UP Gen Project represents the most reasonable and prudent means of meeting its power need and a CON that the costs of the UP Gen Project will be recoverable in rates from UMERC s customers. UMERC should be required to meet its obligations under the ARSA to implement a long term solution for a new, clean generation plant located in the Upper Peninsula of Michigan and the closure of PIPP without violating Michigan law and this Commission s regulations. Therefore, ELPC asks the Commission to deny UMERC s CON applications until such time as UMERC conducts the analysis necessary to carry its burden of proving that the UP Gen Project or some other alternative is the most reasonable and prudent means of meeting demand. 15

19 Respectfully submitted, Date: July 14, 2017 Margrethe Kearney Environmental Law & Policy Center 1514 Wealthy St. SE, Ste. 256 Grand Rapids, MI T: ( F: ( Jeffrey Hammons Environmental Law & Policy Center 35 East Wacker Dr. Ste Chicago, IL T: ( F: (

20 STATE OF MICHIGAN MICHIGAN PUBLIC SERVICE COMMISSION In the Matter of the Application of UPPER MICHIGAN ENERGY RESOURCES CORPORATION for approval of a Certificate of Necessity pursuant to MCL 460.6s for Two Reciprocating Internal Combustion Engine Electric Generation Facilities Located in the Upper Peninsula of Michigan, Approval of Certificate(s of Public Convenience And Necessity, approval of a Special Contract with Tilden Mining Company L.C. and related accounting and ratemaking authorizations. Case No. U PROOF OF SERVICE I hereby certify that a true copy of Initial Brief on behalf of the Environmental Law & Policy Center was served by electronic mail upon the following Parties of Record this 14 th of July, Name/Party Administrative Law Judge Hon. Martin D. Snider Upper Michigan Energy Resources Company Michael C. Rampe Theresa A.G. Stanley Ronald W. Bloomberg MPSC Staff Spencer A. Sattler Amit T. Singh Fibrek Richard J. Aaron Andrew J. Switalski Tilden Mining Company Jennifer Utter Heston Address sniderm@michigan.gov rampe@millercanfield.com stanley@millercanfield.com bloomberg@millercanfield.com sattlers@michigan.gov singha9@michigan.gov raaron@dykema.com aswitalski@dykema.com jheston@fraserlawfirm.com 1

21 Ontonagon County REA Kyle Asher Citizens Against Rate Excess Constance De Young Groh John R. Liskey Attorney General Bill Schuette Michael E. Moody Joel King Cloverland Electric Cooperative Jason Hanselman Upper Peninsula Power Company Michael G. Oliva Leah J. Brooks Michigan Technological University Richard Aaron Courtney Kissel MI NG Holding, LLC ( Glidepath Timothy J. Lundgren Laura A. Chappelle VERSO Corporation Timothy J. Lundgren Laura A. Chappelle Association of Business Advocating Tariff Equity Michael J. Pattwell Sean P. Gallagher Stephen A. Campbell jhanselman@dykema.com mgoliva@loomislaw.com ljbrooks@loomislaw.com raaron@dykema.com ckissel@dykema.com tjlundgren@varnumlaw.com lachappelle@varnumlaw.com tjlundgren@varnumlaw.com lachappelle@varnumlaw.com mpattwell@clarkhill.com sgallagher@clarkhill.com scampbell@clarkhill.com Margrethe Kearney Environmental Law & Policy Center mkearney@elpc.org 2