Michigan Regulators Push for Resilience, Demand Response in the Aftermath of Cold Snap: Report

The Michigan Public Service Commission released a report on September 11 called Statewide Energy Assessment, which Democratic Governor Gretchen Whitmer requested in the aftermath of an energy emergency earlier this year.

In late January 2019, an extreme cold weather event combined with a fire at a major compressor station created an energy emergency in Michigan that challenged the natural gas and electric systems “in a way rarely, if ever, experienced.” according to the report.  A combination of natural gas conservation, curtailment of commercial and industrial electric customers, and emergency procurement of additional natural gas supplies prevented the worse. However, the events raised concerns about the state’s ability to weather another similar storm and maintain the supply of energy.

The report concludes that Michigan has adequate energy supply and delivery systems but also includes a series of recommendations on resiliency and grid modernization, specifically:

• Natural gas planning – Boosting investment in natural gas infrastructure and developing a more proactive approach to repair and replacement of aging infrastructure, as well as risk-based, integrated natural gas planning.
• Integrated electricity system planning – Expanding electrical connections between Michigan and its neighboring states to allow for more imports in extreme situations.
• Valuing resource diversity and resilience – Quantifying the value of diversity in power supplies as part of future integrated resource plans filed by electric utilities. The value of resilience should also be considered in future electric infrastructure planning and investment decisions, including generation sources, transmission and distribution upgrades, and grid modernization technologies.
• Gas-electric interdependencies – Ensuring that, during times of supply disruption, the use of natural gas for heating is prioritized, in coordination with local authorities and large industrial and commercial users.
• Demand response – improve demand response program design, communications protocols. The reports recommends natural gas distribution utilities develop demand response programs as an alternative to broad emergency appeals.
• Cybersecurity standards – Implementing rules for cybersecurity and reporting of security breaches for natural gas utilities based on existing industry standards.
• Propane contingency planning – Developing a formal contingency plan for continued supply and delivery of propane in the event of disruptions.