State regulator gives Consumers Energy OK to recover cost of wind farm
Lansing — State utility regulators on Monday approved Consumers Energy's request to recover the full cost of its purchase of a 166-megawatt wind farm in Hillsdale County.
On July 31, Consumers requested the Michigan Public Service Commission approve its bid to recover the full cost of its build-transfer contract with Crescent Wind LLC. The contract requires Crescent Wind to engineer, construct, install, start up, and test the wind farm in Adams, Moscow and Wheatland townships, then sell it to the Jackson-based utility.
The farm is expected to be in commercial operation on or before Dec. 31, 2020, the MPSC said.
The costs of the wind farm will be recovered through Consumers' power supply cost recovery process and will not immediately affect rates, but likely will be rolled into the utility's next rate case request, said MPSC spokesman Matt Helms. The utility can't file its next rate case until January 2020, according to the commission.
In it's request to the MPSC to recover the costs of the project, Consumers said the wind farm would have a 31-year levelized cost of energy of about $48 per megawatt hour. Levelized cost of energy is the measure of the lifetime costs of a project divided by its energy production, Helms said.
Consumers is not required to publicly disclose the purchase price of the wind park, Helms said.
The electricity cost estimate, the MPSC said, is based on Consumers qualifying for the full value of the federal production tax credit.