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Two States Battle Over Who Should Pay for U.P. Power Plant

Upper Peninsula electric customers could see a significant rate increase December 1st…if federal regulators don’t intervene. But Michigan utility regulators are looking into a long term plan to upgrade electricity generation in the region. 

Public Service Commissions in Wisconsin and Michigan are tied up in a dispute over who should pay to operate the Presque Isle Power Plant in Marquette.

It’s a coal-fired plant that Wisconsin Electric wants to retire, but Michigan authorities say it’s needed as a back up to ensure a reliable supply of electricity. 

Wisconsin regulators don’t want the state’s customers to have to share the cost of operating Presque Isle, but Michigan authorities say it’s not fair to saddle U.P. customers with the whole bill.

Michigan Public Service Commission spokesperson Judy Palnau says the long term solution is a better source of power.  The agency has asked for a study into the best location for a possible new electric plant. 

“So for example it could mean one facility near Marquette. Or it could mean several smaller facilities dispersed in different locations. But that both those scenarios would result in improved electric reliability.”

It could also cost less and carry environmental benefits.  The coal-fired Presque Isle plant will be due for some expensive upgrades by 2016 to comply with emissions regulations.

In the meantime, U.P customers could be looking at a rate hike in December amounting to around 9 dollars a month for a residential electric bill.  Michigan has asked federal authorities to intervene, saying the cost of electricity generation for the region has always been shared between the two states.     

Wisconsin Public Service Commission would not comment on the issue because it’s in litigation.  

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