MISO takes control of Entergy system, extends grid to Gulf

Back to TopCommentsE-mailPrintBookmark and Share

Midcontinent Independent System Operator Inc. will provide power to communities from Canada to the Gulf of Mexico after it takes control of Entergy Corp.’s southern transmission system at midnight, creating the biggest electricity network in the U.S. in terms of area.

The Carmel-based grid operator will expand its footprint from Manitoba and the U.S. Midwest to the Louisiana coast. The move will add 18,000 miles of transmission lines and about 40,000 megawatts of generating capacity in Arkansas, Mississippi, Louisiana and southeastern Texas.

These new territories will give the rest of the Midwest access to power supplies from natural gas and nuclear plants as the region faces a deficit in 2016 with coal plants shutting down, said Todd Hillman, regional vice president of MISO’s southern region. Entergy said joining MISO will eliminate the need to pay for 1,000 megawatts of generating capacity next year and will save its customers $1.4 billion over the next decade.

“We’re trying to maximize the value of the wholesale transmission system,” Hillman said in a telephone interview from Entergy’s offices in The Woodlands, Texas. “In addition to Entergy, we’ve got nine other transmission owners and five other balancing authorities coming into the MISO system tonight also.”

MISO will start reporting spot prices for three new trading hubs at 12:05 a.m. Eastern time Thursday: Arkansas, Louisiana and Texas.

On Wednesday afternoon, the grid operator reported day-ahead prices for these new hubs for the first time. Power for the highest- demand hours of the day averaged in the middle $30s per megawatt-hour, on par with the Midwest, MISO data showed. About 98 percent of electricity for the grid is secured the previous day with the remaining supply procured through the spot market.

At midnight, MISO will increase its transmission system by 27 percent to 83,787 miles and boost its generating capacity by about 30 percent to 171,964 megawatts. Along with Entergy, the southern expansion will include systems operated by Cleco Corp., South Mississippi Electric Power Association, Louisiana Energy and Power Authority and Louisiana Generating LLC.

A survey of MISO market participants shows they expect the region to see a shortfall of 7,500 megawatts to 8,500 megawatts in 2016, Hillman said.

Generating capacity

About 51 percent of the generating capacity in MISO’s Midwest region is from coal versus 33 percent from other fossil fuels and 7 percent nuclear. Coal’s share will drop to 46 percent after the Entergy integration.

Hillman said MISO expects to be the biggest grid operator geographically after the integration of the Entergy system. He said it will be smaller than PJM Interconnection LLC in terms of overall generating capacity, as PJM operates in the country’s big population centers along the East Coast. PJM serves more than 60 million people in 13 states, including the Washington, Philadelphia and Chicago metropolitan areas.

Entergy will continue to operate regulated utilities in such places as Arkansas and Louisiana, but will now be able to purchase all of the electricity to serve households and businesses through the MISO wholesale market, said John Hurstell, vice president of system planning with Entergy, from The Woodlands office near Houston. The New Orleans-based company will also sell all of the output from its power plants through MISO, he said.

‘Lowest price’

“If Entergy saves a dollar on generating costs, that’s a dollar less we have to get from our ratepayers,” said Hurstell. “Our customers don’t care whether they get their power from the Entergy units or some other units. They just want to get the lowest price possible.”

MISO prices will show little gains next year because of its expanding footprint and lack of Midwest economic growth, Jeff Baden, head of DNV GL’s market and policy development practices for the Americas, said in a telephone interview.

“Evidence suggests that prices are slightly lower in total” after a competitive power market expands geographically and adds a deep base of generating capacity, said Baden, who is based in the Philadelphia office of DNV, which advises utilities to competitive retailers.

On-peak wholesale electricity for MISO’s benchmark Indiana hub are averaging $38.85 a megawatt-hour for calendar year 2014, according to Bloomberg Fair Value prices. That is little changed from day-ahead prices averaging $38.06 so far this year, grid data show.


Post a comment to this story

We reserve the right to remove any post that we feel is obscene, profane, vulgar, racist, sexually explicit, abusive, or hateful.
You are legally responsible for what you post and your anonymity is not guaranteed.
Posts that insult, defame, threaten, harass or abuse other readers or people mentioned in IBJ editorial content are also subject to removal. Please respect the privacy of individuals and refrain from posting personal information.
No solicitations, spamming or advertisements are allowed. Readers may post links to other informational websites that are relevant to the topic at hand, but please do not link to objectionable material.
We may remove messages that are unrelated to the topic, encourage illegal activity, use all capital letters or are unreadable.

Messages that are flagged by readers as objectionable will be reviewed and may or may not be removed. Please do not flag a post simply because you disagree with it.

Sponsored by

facebook - twitter on Facebook & Twitter

Follow on TwitterFollow IBJ on Facebook:
Follow on TwitterFollow IBJ's Tweets on these topics:
Subscribe to IBJ
  1. So much for Eric Holder's conversation about race. If white people have got something to say, they get sued over it. Bottom line: white people have un-freer speech than others as a consequence of the misnamed "Civil rights laws."

  2. I agree, having seen three shows, that I was less than wowed. Disappointing!!

  3. Start drilling, start fracking, and start using our own energy. Other states have enriched their citizens and nearly elminated unemployment by using these resources that are on private land. If you are against the 'low prices' of discount stores, the best way to allow shoppers more choice is to empower them with better earnings. NOT through manipulated gov mandated min wage hikes, but better jobs and higher competitive pay. This would be direct result of using our own energy resources, yet Obama knows that Americans who arent dependent of gov welfare are much less likely to vote Dem, so he looks for ways to ensure America's decline and keep its citizens dependent of gov.

  4. Say It Loud, I'm Black and Ashamed: It's too bad that with certain "black" entertainment events, it seems violence and thuggery follows and the collateral damage that it leaves behinds continues to be a strain on the city in terms of people getting hurt, killed or becoming victims of crimes and/or stretching city resources. I remember shopping in the Meadows area years ago until violence and crime ended make most of the business pack you and leave as did with Lafayette Square and Washington Square. Over the past 10 to 12 years, I remember going to the Indiana Black Expo Soul Picnic in Washington Park. Violence, gang fights and homicides ended that. My great grandmother still bears the scares on her leg from when she was trampled by a group of thugs running from gun fire from a rival gang. With hundreds of police offices downtown still multiple shootings, people getting shot downtown during Black Expo. A number of people getting shots or murdered at black clubs around the city like Club Six on the west side, The Industry downtown, Jamal Tinsley's shot out in front of the Conrad, multiple fights and shootings at the skating rinks, shootings at Circle Center Mall and shooting and robberies and car jackings at Lafayette Mall. Shootings and gang violence and the State Fair. I can go on and on and on. Now Broad Ripple. (Shaking head side to side) Say It Loud, I'm Black and I'm Ashamed.

  5. Ballard Administration. Too funny. This is the least fiscally responsive administration I have ever seen. One thing this article failed to mention, is that the Hoosier State line delivers rail cars to the Amtrak Beech Grove maintenance facility for refurbishment. That's an economic development issue. And the jobs there are high-paying. That alone is worth the City's investment.