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I&M proposes plan to extend operations at Cook Plant

by on May 4, 2012
 

FORT WAYNE — Indiana Michigan Power (I&M) has filed a proposal with the Michigan Public Service Commission (MPSC) outlining a $1.17 billion project at the Donald C. Cook Nuclear Plant in Bridgman, Michigan. The project will sustain the plant over the 20-year extension of its operating license and continue to make a source of reliable and emission-free power available to its customers.

“The Cook Plant plays a significant role in allowing I&M to provide our customers with safe, reliable, low-cost, and efficient electric service,” said Paul Chodak III, president and chief operating officer for I&M. “The Cook Plant also provides a strong economic advantage to the Michiana area. For example, nuclear plants provide a significant number of high quality jobs, which support our employees’ families and the businesses they patronize.”

In its filing, I&M is asking regulators to recognize that there is a viable need for the project, named the Life Cycle Management Project, and allow for timely recovery of finance costs associated with the work.

The two units at the Cook Plant generate over 2,100 megawatts — enough energy to power approximately 1.5 million homes  — and account for 40 percent of the company’s power generation portfolio. The operating license for Cook unit 1 was issued in 1974, with the license for Cook unit 2 issued in 1977. I&M received license extensions from the Nuclear Regulatory Commission (NRC) in 2005 that will allow the units to run until 2034 and 2037 respectively –an additional 20 years beyond their original operating licenses.

Among the benefits of Cook Nuclear Plant is the fact that the plant provides a hedge for I&M’s customers against the cost of complying with increasingly stringent federal air emission regulations. Cook also has a positive economic impact on the area, providing 1,100 jobs with an annual total payroll of $100 million during normal operations and another 1,000 supplemental workers during outages. Furthermore, Cook pays taxes of $20.3 million annually to the state of Michigan.

The Life Cycle Management Project consists of a group of projects, with the majority of work to be performed during regularly scheduled refueling outages. Initially, I&M indicated that the overall cost of the Life Cycle Management Project at Cook would be just under $2 billion. The extensive analysis that has been performed since then lowered the overall estimate of the project to $1.17 billion.

Currently, I&M plans to recover costs associated with project through general base rate cases in Michigan over the course of the project. This process makes it possible for I&M to phase in the recovery of the costs as they occur over the time of the project, as opposed to a large, one-time hit on customer bills after the project is completed.

I&M understands the impact that cost increases can have on customers, and we do not take this lightly,” said Chodak, “Ultimately, this project is the most reasonable and prudent means of ensuring that I&M customers experience the advantages of having the Cook Plant for years to come.”

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